How Did India’s SpiceJet Come Back from the Brink?

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In December  2014 India’s SpiceJet followed the 2012 demise of Kingfisher by suspending all flights. Unlike Kingfisher, SpiceJet has roared back.

SpiceJet 01

The Economist profiles the recovery:

It is filling 93% of available seats and cancelling only 0.13% of scheduled flights each month. It has had three consecutive quarters of profits, having lost money in the previous five quarters. It has some way to go before it regains the 20% domestic market share it had in 2013; but with a share of 11% in the first ten months of 2015 it is the country’s fourth-largest airline. SpiceJet’s shares are now worth around six times what they had fallen to on the day after the temporary shutdown.

There are external factors lifting all boats such as low fuel prices and increased demand, yet credit is due for major efficient improvements:

Then came a slew of efficiency measures which added up to big improvements in the performance of the carrier’s fleet. Pilots of its Bombardier Q400 turboprops, which serve second-tier cities, were told to step on the gas to shave a few minutes off each flight, making it possible to squeeze in one extra trip each day. The steel brakes on the wheels of its Boeing 737s were replaced with lighter carbon brakes, cutting fuel consumption. The number of in-flight magazines on each aircraft was reduced, and attendants began serving meals in cardboard boxes instead of on plastic trays—again, trimming the aircraft’s weight and cutting fuel burn.

More attention was paid to filling each plane’s tanks with just enough fuel, with a suitable safety margin, but no more. Pilots now lower their planes’ landing gear 7-8km from touchdown, instead of 14km as before; and on the ground they often now taxi on just one engine. Stocks of spare parts were improved at the carrier’s main bases, to get planes back in the air faster. SpiceJet’s aircraft spend roughly 13 hours a day in the air, whereas for other Indian airlines the figure is just 10-12 hours, says Kiran Koteshwar, the chief financial officer. On the revenue side, the airline has boosted its earnings from ancillary services such as on-board meals and seat selection.

Next up is a foreign hub in what is often half-jokingly called India’s airport hub: Dubai, and the new Al Maktoum International Airport.

I have fond memories of SpiceJet. On my Varanasi trip I could not locate a taxi back to the airport, took a tuk-tuk and was very late to the airport. When things are running on time, Indian flights close check-in early, board early and depart early. This was the last flight out for the night. Check-in was closed. Security was closed. I rushed to the SpiceJet office 20 minutes before scheduled departure. The station manager did everything in his power to boot up check-in, call security to re-open, call the pilot to hold and made it all happen for one passenger who knew better than to be so late. I sent a glowing note about him to SpiceJet and was surprised to see the COO of the company return with a personal reply.

Great to have them back in the skies!

SpiceJet 02

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Deo
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Deo

Presently, a new airline starting up in India has to complete 5 years in domestic aviation and has to have 20 aircraft before it’s allowed to go International. However, this 5/20 rule is archaic in current times and efforts are underway to either abolish it or else modify it with a reformed system. As always, the opppsers to the abolishment or modifications are the current carriers, who claim it’d be injustice to them as they had to suffer in their early years. Vistara started its flights on January 9, 2015; so a long way to go in any case. Plus,… Read more »

Deo
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Deo

The Spicejet COO that replied to you is Sanjiv Kapoor, one of the most talented brains in Indian Aviation. He oversaw much of this turnaround and has since been poached up by Vistara, the new kid on the block.

https://in.linkedin.com/in/sanjiv-kapoor-45a40543

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Frank
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Frank

I’ve never had a bad experience with Spicejet. Not quite as luxurious as the likes of Jet, perhaps, but they’ve consistently made me leave the plane happy. That was good of you to write to them, and great to hear the COO replied!