The nightly aircraft line-up tail parade at the apron of Kempegowda International Airport Bangalore
The nightly aircraft line-up at the apron of Kempegowda International Airport Bangalore

Vistara to acquire GoAir. Will fly international soon.

March 12, 2015 16 Comments 611 Views

The Tata-Singapore Airlines promoted Vistara will acquire GoAir sources within the airline say.

GoAir CEO Giorgio De Roni. Airline image.
GoAir CEO Giorgio De Roni. Airline image.
The Wadia group promoted airline is struggling after CEO Giorgio De Roni was reportedly taken ill, earlier this year, and is convalescing in Italy. Sources indicate, De Roni is not expected to return. De Roni is credited with making the GoAir profitable after the initial management had brought the airline to its knees earning it the moniker “No-Go Air”. India’s largest domestic carrier, IndiGo has been the only other profitable Indian carrier.

Sources indicate Vistara made a compelling offer to the promoters, who, like the Marans of SpiceJet, wanted to focus on their core business and exit the airline business. In addition to departure of De Roni, the dominance of fellow low cost carrier IndiGo who operates 600 daily flights compared to GoAir’s 140, and the resurgence of SpiceJet and Jet Airways after their financial bailouts appears to have clinched the decision for the Wadias.

GoAir Airbus A320 VT-GOJ takes off from New Delhi. Photo by Devesh Agarwal.
GoAir Airbus A320 VT-GOJ.
GoAir is expected to bring a number of immediate and long term benefits for Vistara to capitalise on. This includes the cherished ability to fly internationally. GoAir is over five years old, and with Vistara’s four aircraft will cross the 20 aircraft requirement under India’s restrictive “5/20” rule. Vistara is keen to launch services to Singapore and to London.

Go’s unusual domestic network which directly connects Tier I cities like Mumbai to Tier II cities like Bhubaneshwar, dove-tails well with Vistara’s, and gives immediate Tier II capacity for Vistara to rapidly expand to other Tier I cities like Chennai, Bangalore, and Kolkata, and still be compliant with the government’s new route dispersal guidelines which mandate deployment of capacity to Tier II cities. Additionally, Vistara, which already has a hub at India’s largest airport New Delhi, also gets a hub along with many valuable slots at India’s second largest and highly congested, Mumbai airport.

Vistara Airlines, Airbus A320 VT-TTB in its official livery
Vistara Airbus A320 VT-TTB. Airline photo.
On the fleet side, GoAir and Vistara both operate an all Airbus A320 network. The combined network will grow to 24 by this month end, and to 26 by this year. Go also has an existing order with Airbus for 72 of the new A320neos whose deliveries are expected to commence next year. While Vistara has pending orders of 16 aircraft as of today. Vistara’s competitors especially IndiGo and Jet Airways have been adding significant capacity to Vistara’s destinations. The combined network will enable Vistara to offer a more broad-based and larger competition quickly.

As far as the cabin product is concerned, GoAir already offers a GoBusiness product. Given the price considerations to most of GoAir’s destinations, one can expect Vistara to convert Go’s single class A320s to a two class cabin offering the premium economy and economy class.

Looks like interesting times ahead. Stay tuned.

Do you think the business case suggested in this satirical article is feasible? Share your thoughts via a comment.

About Devesh Agarwal

A electronics and automotive product management, marketing and branding expert, he was awarded a silver medal at the Lockheed Martin innovation competition 2010. He is ranked 6th on Mashable's list of aviation pros on Twitter and in addition to Bangalore Aviation, he has contributed to leading publications like Aviation Week, Conde Nast Traveller India, The Economic Times, and The Mint (a Wall Street Journal content partner). He remains a frequent flier and shares the good, the bad, and the ugly about the Indian aviation industry without fear or favour.

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16 comments

  1. GS
    March 12, 2015 at 15:45

    What happens to the large pending 320NEO order? Thats a lot of burden to take on by Vistara since they have not outlined their fleet growth strategy yet. Would you be able to throw light on that?

  2. Indraneel Upponi
    March 12, 2015 at 16:04

    Vistara planning to fly to London? Are they getting wide bodies too?

  3. K
    March 12, 2015 at 16:34

    I think the business case makes sense Sir. But, is this article genuinely “satire”?

  4. Keyur Jadhav
    March 12, 2015 at 16:59

    Does it seem like Kingfisher airlines acquiring Air Deccan to fly abroad???

  5. Janak Thaker
    March 13, 2015 at 01:10

    Clarification from Vistara – https://twitter.com/airvistara/status/576073009888296960

  6. vivek
    March 13, 2015 at 15:53

    Don’t think it was very responsible of such a trustworthy site to put up a satirical article. Leave the satire to the satirists. I hope you focus on real news here on. A lot of people rely on your site for the latest and unbiased news. I myself didn’t expect nor notice that article was satirical.

    Please avoid this in the future.

  7. Jinto
    March 13, 2015 at 20:47

    This would have been a perfect article on April 1st. But I was too excited about this news and shared the news with friends in my circle and I had to apologize. Otherwise, you have been great with your articles.

  8. Rohan
    March 13, 2015 at 22:08

    hahaha….what the heck….i’m a fan of GO air, and i was really disappointed at first….but i must say the arguments make sense.

  9. shekhar
    March 13, 2015 at 22:13

    Please be clear in the beginning of your article that it is fake. Please stick to reporting real news and not story telling!

  10. RAFIQUE AHMAD
    March 14, 2015 at 12:26

    IT WILL BE BLESSING IN DESGUISE FOR BOTH THE COMPANIES IN TERMS OF BUSINESS AS WELL AS PROFESSIONALISM OF THE CONCERNED INDUSTRY AND WILL LEAD TE COMPANY TO SKYTOUCHING HEIGHTS IN TERMS OF PROGRESS AND DEVELOPMENT

+OK
+OK