Alliance air will also be sold according to a report. May be Spice jet will get this as a consolation.
As far as Indigo goes, they were a thorn in everybody's way - Jet, Kingfisher, AI, Spicejet, even regionals, and used capacity dumping to a new level.
What this ET article says is that Alliance Air might also be put up on the selling block in the future. For now, it stays in Govt hands. Alliance is not part of the Tata deal.
For a number of reasons, Alliance cannot be sold. For the simple reason that Alliance Air is being used to operate to sub-par sectors. Whether people like it or not, the model in India is that the Govt airline enters a new route, develops it and then farms it out to a private carrier once it becomes profitable. Also, Third world Govts like the one in India need a state owned carrier to dispense favors, operate non-profitable "social" sectors and a "ghar ki murgi" for doing thankless National Service that no one else will. Air India/Indian Airlines did it in their day and now the Govt will certainly need a replacement. Enter a rebranded Alliance.
Alliance Air, rebranded in a new sanskaari avatar with a tacky livery, will soon be criss-crossing India very soon at 16000 feet. Once they get new Airbuses from that Chinese leasing company, they will be flying to the regional countries as well. In essence, a new sanskaari version of the old Indian Airlines.
Your reference to IC days, of connecting state capitals or far flung areas to DEL, doesn't hold much relevance today as 6E is doing that job with extremely high frequencies. So no need to have another pan-India govt airline to fill any gaps in the network at the national capital atleast. Today DEL is the hotspot for every pvt airline. Beyond DEL, like said above, govt just has to promote the new tier3 airports to pvt airlines by showing Alliance flying there.
True. 6E is doing a fine job dumping capacity far in excess of demand. But just how profitable are they? How long can you cook the books with SLBs to companies based in Tax havens? Like KingFisher, 6E is also a bubble! Bloggers didnt see the flaws in KF either when they were jetting around on free tickets in return for promoting the airline on forums like these. KF was the best thing back then since sliced bread and it would never end! Until it did! Now, those Bloggers are flying 6E (except one who prefers SpiceJet
), and people are being told the same lies that were once spun about KFA! The mix of a private Air India in Tata hands and the new Govt carrier is sure to impact business. And I am sure someone in RBI will soon find out about this nice little SLB game that 6E is playing. Interesting Times!
If the govt decides to scale up Alliance Air to another pan-India domestic carrier, they'll be back to square one : that is end up with another loss making AI in their hands.
Can I get a Hallelujah?! Bhakts who were arguing for selling Air India with the reasoning that "Govt should not be in Airline business" will soon have to argue to the contrary within the next 12 months. I feel for them - NOT!
As i have always argued, Govt should not be in the Airline business. But in India/South Asia, that will always be the case. And that is exactly what is playing out before us! Save this post! We will be discussing this again over the next year!
PS: Is it necessary for Govt babus to learn about Leasing Contracts and all that? Are Power by the hour contracts the new standard? Are PBTH contracts cheaper if utilization is less than 10 h/day? Isnt India in an undeclared war with China on the Northern and Eastern borders? Wont that cause a problem if you lease Airbuses from a Chinese company?
So many questions! Will just have to wait and watch! GET THE POPCORN!