We had set ourselves a task no airline in the 120-year history of global aviation had ever done: Vinay Dube

Vinay Dube, CEO, Akasa Air Image: Mexy Xavier
 
In just nine months since it began operations in the Indian skies, Akasa Air has cornered a market share of about five percent, while adding a record 19 aircraft to its fleet. That’s the fastest any airline has managed, both in terms of market share and fleet size, since India opened up its aviation sector to the private sector in the early 90s. Now, the Mumbai-headquartered airline is gearing up to place a three-digit order for aircraft as it looks to begin international operations.
 
In an interview with Forbes India, CEO Vinay Dube talks about how the airline was started, Boeing’s bet on Akasa Air, how it can’t be pigeonholed into a category, going international, and ordering more aircraft.

Edited Excerpts:
 
Q. You’ve had phenomenal run over the past nine months. How do you look back at it?
The past nine months have been overwhelmingly positive. We had set ourselves a task that no airline in the 120-year history of global aviation had ever done, which was to go from zero to 20 aircraft within 12 months. We've got 19 today, and the 20th will get delivered in another 45 days. We’ve consistently been India’s most on-time airline. Many fast-growing companies are forced to make trade-offs but we’ve managed the growth with reliability and customer satisfaction. In May, I believe, our market share hit 5 percent.
 

Q. Did you plan such that you will have 20 aircraft and 5 percent market share in a year’s time?
For aircraft, yes. The future delivery of aircraft is something that is planned and orchestrated dating back to 2021. But the market share is not something we anticipated, nor something that we're focused on. Market share is not a goal of ours. Being India's most on-time airline, and having happy customers, are the things that we had planned to execute. When that plan comes together, it's a great feeling. But market share was not one of them and we're still pretty amazed at the result.
 
Q. With an airline going down, would you then consider ramping up your efforts to corner more of the market?
We do not consider this as an opportunity as such. I say this because when airlines try and stretch beyond their limits, and have knee-jerk reactions to get a little bit of share, and don't operate in a disciplined manner, that's when things go horribly wrong. There's not a single aircraft that we are going to take ahead of time. Between March and September, we had planned for one delivery. And, the reason we planned it that way was because when you go from zero to 20 aircraft very quickly, we want to make sure there's no other unintended consequence.
 
Q. What are some of the possible unintended consequences?  
When you are giving yourself a degree of difficulty by being the fastest-growing airline in history,  it's typically the sanctity of the operations that could possibly feel some unintended pressures like degradation of on-time performance or higher cancellation rates, or lower technical dispatch reliability. We will not compromise on the dependability and reliability of the operation as that’s what has got us here. Steering away from that to potentially go after a very short-term commercial opportunity is dangerous. There's nothing that we do at Akasa that's short-term. Everything that we are building is with the intention of creating a durable airline that can last generations.
 
Q. Considering not many airlines in India have lasted beyond three decades, apart from Air India, how do you build an airline for generations?
First and foremost, you have to have a professional and empowered management. Some airlines in the past have had professional management teams that haven't been empowered. This is not a glam business. This is a business of operations, numbers, financial prudence, cost management, liability, and focus on employees. You have to be very service-oriented. You need to be very employee-centric and cost-leadership-focused. If one can build these values into their culture, that's how you build a durable franchise.

Also read: Akasa Air is on an unprecedented flight plan. Can it really redefine flying in India?
 
Q. What prompted you to build an airline?
It was frustrating not being able to work for an airline that I thought had a professional and empowered management team. I wanted to create an airline that we could build from scratch where we would be able to focus on cost, leadership, service excellence, employee centricity, and a non-controlling capital structure to make sure that we remained well capitalized.
 
If you look at where aviation is going in India, we're just going to grow and grow. We're going to get 2000 more aircraft here in the next couple of years. When you have that kind of exciting growth, that doesn't have much to do with airlines but with the economic engine that we're creating, the thought was the construct of another airline with the very simple characteristics done right from day one, that could be extremely enduring and profitable.
 
Q. How did you stitch together the team?  
We're a professionally run company owned and managed well by a set of people. We have members of the board and we have the executive leadership team and someone like me straddles all three. But just going back early in the days, it all starts with who you want to build an airline. An airline is way too vast to think that one person can do. We got a lot of help from the original equipment manufacturer (OEM) that believed in the team.
 
Q. How did you decide on the Boeing 737 Max, despite all the troubles the aircraft had, and go about the 72 aircraft order?  
I have seen multiple aircraft types go through their ups and downs. There's not a single new aircraft that I can remember that didn't have some issue or the other. I was 100 percent confident that whatever issues were identified with the Max 737, would be overcome. This is the most scrutinised aircraft in the history of aviation. And therefore I thought that this would be the best aircraft for Akasa and it's a great one.
 
It's one of the most fuel-efficient aircraft and this is why we can claim Akasa to be the greenest airline on the planet. It's an aircraft that has the most amazing legroom. When you look at the interior noise, air pressure, the circulation of the air, we thought that this was the aircraft that would not just provide the best economics for us but also focus on the longevity of our planet by being extremely green.
 
Q. With the 20th aircraft coming soon, how are you going about your international operations?
We are planning to start international operations at the end of this year. We haven't picked a date but it's at the tail end of this year. And as for the routes it’s going to be the Middle East, Southeast Asia, Nepal, Sri Lanka, Bangladesh, more of the usual routes that we would fly to begin with.
 
By the end of this calendar year, we should be placing another much larger three-digit order. Because our existing order will be delivered by the end of March 2027. And we want to place an order for the subsequent years as well.
 
Q. Would that be from the same OEM?  
It's not just the manufacturer of the aircraft, but also the engine. Having the same aircraft and a similar engine does provide a lot of benefits. We also need to ensure that we get the right economics from the same engine, and that process is on.
 
Q. You mentioned you are well-capitalised. How are you doing financially now?
We're doing better than we expected. We are a bunch of planners at Akasa and we plan not five years out but 10 years out whether it’s with cash, or profit and loss, or employees. 

Also read: Why do India's airlines choose foreign CEOs?
 
Q. The aviation industry has emerged into something of a duopoly. Does that worry you?
Over the last 20 years, one of the most successful airlines in the US is Alaska Airlines.  And you don't have a duopoly in the US, you've got an oligopoly between United, American, Southwest, and Delta. They have 80 plus percent market share and you have Alaska Airlines that may have 5 percent or 7 percent or 8 percent of the market share. But it has some of the happiest employees, customers, and shareholders as a whole.
 
Hence we're not worried about what others are doing. If we focus on our employees, customers, operations, cost structure, capitalisation, we'll be just fine. India is a market where you can have multiple airlines thrive if they're run properly. And we're just focusing on running a good proper airline.
 
Q. How do you see the market for low-cost carriers and full-service carriers in India?  
I hope you're not referring to us as a low-cost carrier because I'd like to think of us as almost a category-redefining airline. Our on-time performance is the best and if you couple that with the most comfortable seat in Indian aviation, brand new aircraft, more legroom, and the best food, some of the warmest, most well-trained, most empathetic, and kind flight attendants, I think you've got customer experience that is second to none. So I don't want us to be pigeonholed into a particular category.
 
If you look at the car business, you'll always have a growing segment for Maruti Suzuki and you'll always have a growing segment for Mercedes. Aviation is the same. You'll have growing segments no matter where you are. Eventually, our consumers will define which category we belong in. I just want to make sure that we allow our consumers to define us.  
 
Q. So where does Akasa go from here?
We're only 10 months old and our plans are extremely well laid out. We've got 19 aircraft and we want aircraft number 20 and 50 and 75 and 200 and 300.  It's an airline that we hope to have around for a long time, and what we're doing as this generation of leaders is building the foundation, and eventually it'll be handed on to the next generation of professional leaders.