India's Newest Airline Akasa Air Begins Commercial Operations

A Maiden Flight Of Akasa Air With Low-Cost Aviation's Heavy Hitters

India’s youngest airline Akasa Air, which is backed by billionaire Rakesh Jhunjhunwala, began commercial operations on Sunday with a maiden flight from Mumbai to Ahmedabad. It appears to have jumped right into combat with low-cost aviation's heavy hitters. The first commercial flight of Akasa Air was essentially launched by aviation minister Jyotiraditya Scindia. The 189 passengers on board the fully booked flight were joined by the cockpit and cabin crew.

Flights of Akasa Air

The airline, which operates under the code QP, would provide 28 flights every week between Mumbai and Ahmedabad. The first flights between Bengaluru and Kochi will depart from the capital of Karnataka at 7:15 am and 11 am on August 13. Bengaluru will be reached by flights from Kochi at 10:25 am and 2:15 pm. Services between Bengaluru and Mumbai will start on August 19 and between Chennai and Mumbai on September 15. On November 26, 2021, Akasa Air and Boeing agreed to a purchase agreement for 72 Max aircraft. The DGCA had earlier approved the use of Max aircraft beginning in August 2021. The airline stated that it will prioritise connection between metro areas and tier 2 and 3 routes with a fleet induction strategy of two 737 MAX aircraft per month. By the end of March 2023, the fleet will increase to 18 aircraft, and over the following four years, the airline will add another 54 aircraft, bringing its entire fleet to 72.

Founder of Akasa Air

Akasa was founded by Jhunjhunwala, dubbed "India's Warren Buffett," former Jet Airways CEO Dube, and former IndiGo CEO Aditya Ghosh. Akasa, which has ordered a total of 72 Boeing aircraft, will face off against other low-cost airlines like IndiGo, SpiceJet, and GoFirst. An airline has never been created and launched in a single year anywhere in the globe. Many cited the tumultuous past of billionaire-backed airlines in the nation as well as the ominous global economic picture as reasons why the 62-year-foray old's into the capital-intensive industry raised suspicions. Numerous well wishes for Akasa Air's continued success were given, however the aviation environment in India appears to be quite difficult. The cost of jet fuel is skyrocketing, and the coronavirus damage to the sector is still being felt.

Need of  introducing Akasa Air

With the number of air travellers expected to reach 40 crores by 2027, the country's civil aviation sector is set for a fantastic and healthy rise in terms of passengers, aircraft, and airports. According to data from aviation regulator the Directorate General of Civil Aviation, domestic airlines carried 57.2 million passengers between January and June 2022 as opposed to 34.3 million during the same period the previous year, registering an annual growth of more than 66 percent and monthly growth of more than 237 percent (DGCA). Furthermore, it is anticipated that the post-Covid-19 recovery will persist. Additionally, because Indian travellers are extremely cost-conscious, one of the major factors influencing market demand is ticket prices.

Apart from the partial rollback of salary reductions due to the steep rise in jet fuel prices, the industry's profitability has been significantly harmed despite an increase in demand. Due to increased competition brought on by new airlines like Akasa, the revival of Jet Airways, and the consolidation of the Tata group-owned airlines Air India, Air India Express, Vistara, and AirAsia India, passengers may experience a decrease in airfares. However, high fuel expenses might be made even worse by rising oil prices and a falling rupee. The cost of running an airline in India nowadays is largely accounted for by fuel, which accounts for 50% of operational expenses.

Current Issues 

Unrestricted capacity, fare wars, and structural difficulties—particularly the high price of jet fuel—are some of the current worries. In the medium future, prime slots at urban airports will also be a barrier, but when additional airports and greater airside capacity are built, this will get better. Consistent service delivery will be a continuous issue for an airline entering a market with high passenger volumes, fierce competition, and constrained infrastructure. The benefit of beginning afresh, though, might be Akasa's greatest advantage. The low-cost carrier, backed by billionaire investor Rakesh Jhunjhunwala, would thus need to offer a product that is both innovative and unique in the aviation industry, which is the one that is growing the fastest and is also facing a number of difficulties.