Tata SIA Airlines flights to launch by May-June 2014

NEW DELHI, India – A day after FIPB cleared the Tata-Singapore Airlines’ (SIA) airline venture, Tata group Chairman Emeritus Ratan Tata and SIA chief Goh Choon Phong on Friday met Civil Aviation Minister Ajit Singh exuding confidence of launching flights by May-June next year.

“We are looking at very fast clearances. We hope that we will be able to launch by May-June,” Tata SIA Airlines Chairman Prasad Menon, who accompanied Tata and Goh, told reporters after the 45-meeting with Singh here.

Maintaining that the entry of Tata-SIA Airlines would benefit the Indian aviation sector, the minister said SIA was globally known for its expertise in technical and managerial matters and was one of the best airlines in the world.

Asked when the Civil Aviation Ministry would give the necessary clearances to the new carrier, Singh said, “I don’t see any problems. DGCA will have to be satisfied. There are issues relating to fleet, parking space, slots and routes. It depends on how fast they (Tata-SIA) provide all those data and documents.”

Complimenting the minister for “opening up the aviation sector in a really global manner”, Tata said “It is our responsibility to make him proud” and the Tata Sons’ airline venture with SIA was “a great opportunity” towards that end.

The meeting came a day after the Foreign Investment Promotion Board (FIPB) gave its green signal to their proposal to start a full-service airline entailing an initial foreign investment of USD 49 million.

Tata Sons will invest USD 100 million in the joint venture. This is Tatas’ second venture in the aviation sector after its tie-up with Malaysian carrier Air Asia in February for a low-cost passenger air service in the country.

To a question on what kind of aircraft would the proposed airline consider flying, SIA CEO Goh and Menon said no fleet plan has yet been drawn up.

“We are working on it,” said Goh. Maintaining that “the new airline will provide premium (full-frill) service”, Tata said he was excited about FIPB approval and added that a lot of hard work needed to be put in to start the airline.

Asked whether they would start the airline with a few aircraft from the SIA fleet like AirAsia India was planning to do, Goh said, “We will consider it (operating flights with SIA planes till new fleet is inducted). That is a possible option.”

Goh and Menon said SIA would pump in money for equity infusion into the new airline joint venture. Earlier in the day, Tata and the delegation met Commerce and Industry Minister Anand Sharma and Economic Affairs Secretary Arvind Mayaram.

On Thursday, Tata and Goh had also met Finance Minister P Chidambaram after the FIPB cleared the venture. To be called Tata SIA Airlines Ltd, the venture would be headquartered in Delhi.

In seeking approval to offer full-service passenger airways on both domestic and international routes, Tata Sons and SIA have assured the government that control of their proposed venture would always remain in Indian hands.

Of the six directors, four would be nominated by the Tatas. Aviation industry analysts have welcomed the decision, saying it would send very positive signals to the global investor community.

Tata Group will be interested in Air India if it is privatised, its Chairman Emeritus Ratan Tata said on Friday amid reports that the government is inclined to give up control in the state carrier.

“As an when it happens, we would be very happy to look at it,” Tata said when asked whether he would be interested if Air India was privatised. Tata was speaking to reporters after he, along with Singapore Airlines CEO Goh Choon Phong and Tata-SIA Chairman Prasad Menon, met Civil Aviation Minister Ajit Singh.

Singh, who was standing beside Tata, didn’t said anything.

Tata’s comments came weeks after Singh said it was his personal opinion that the government should not be in service sectors like airlines or hotels and any future regime could consider privatisation of Air India, as the government would not give any more funds to the airline after it completed equity infusion of Rs 30,000 crore till 2021.

Air India was formed as a division of Tata Sons Ltd (now Tata Group). It was being run as Tata Airlines till 1946, after which it became a public limited company.

Asked about reported discontentment expressed by Arun Bhatia of Telstra Tradeplace, a promoter of AirAsia India, over the Tata Sons floating a joint venture with SIA for launching another airline, Tata said, “There is no confusion within AirAsia India… I am not aware of any such thing.” Bhatia had reportedly called the Tata-SIA joint venture as “unethical” and said he was “shocked to hear the news”.

He had also reportedly claimed that the Tata Group had not informed him about it.