SpiceJet takeoff in summer, fares to be 'dynamic'

Royal Airways (formerly known as ModiLuft) today announced the launch of its low-cost, no-frills airline called SpiceJet and said that it will be competitively priced vis-a-vis the existing fares of low-cost airlines in India.

Airline industry sources said the carrier is expected to offer fares that are on a par or lower than the existing low-cost fares.

Senior executives with Royal Airways said they were still finalising the fare. SpiceJet plans to start services from early this summer.

It is expected follow a dynamic pricing model for its flights. As per this model, the fare on a particular flight is determined on the basis of the demand and availability of seats.

"Using the latest technology is the only way we can ensure that we provide attractive pricing without compromising on quality. Driving a low-cost structure, boosting productivity and delivering value will be our focus," said Mark Winders, chief executive officer, SpiceJet.

The airline will start its service with five Boeing 747-400 aircraft in the first phase. It plans to start services in the busy and lucrative Delhi-Mumbai sector, Delhi-Bangalore, Delhi-Chennai and Delhi-Kolkata sectors. Besides, it will operate services in the non-metro sectors as well.

Royal Airways seems to follow a different business model than Air Deccan, India's first low-cost carrier, which first started operations in the non metro routes and gradually expanded operations in the metro sectors.

Aviation experts are of the view that with more low-cost carriers starting operations in key sectors, airfares are expected to fall from the present levels.

Following the entry of Air Deccan, the airfare in sectors like Delhi-Mumbai has come down to as low as Rs 700.

Aviation experts expect that India will see a major spur in the number of low cost carriers with at least 10 new such airlines starting operations in the next 18 to 24 months.

Royal Airways was given a no objection certificate by the government in November last year to start operations.

According to a statement by Royal Airways, the SpiceJet name and its imagery have been chosen to reflect the aspirations of today's fast-paced and tech savvy travellers; vibrant and energetic imbibing Indian ethos and flavour.

Company executives also said the SpiceJet name has been registered and is not in conflict with the Spice brand of the B K Modi Group.