Regional airlines delay new operations

July 12th, 2008 - 9:27 pm ICT by IANS  

New Delhi, July 12 (IANS) Rising fuel and operational costs have put regional airlines in a fix, delaying their plans to launch new operations. Only three regional airlines, MDLR Airlines, Jagson Airlines and Star Aviation, have won permits to start additional operations, said an airline official.

Industry sources said some proposed regional airlines have decided to delay the launch of operations and also planned to postpone the delivery of aircraft owing to recession in the aviation industry.

Jagson Airlines chairman Jagdish P. Gupta said the industry was expecting a combined loss of $2 billion this fiscal owing to which the government has tightened its norms for issuing airline permits.

At least half-a-dozen companies are waiting for permits to operate as regional carriers, which would fly between large and small cities or between small cities.

The ministry of civil aviation has delayed the issuance of permits as it is scrutinising and reviewing the financial and business models of the airlines in the wake of the turmoil in the market.

According to Gupta, the low cost carriers are also paying the same service charges the scheduled airlines pay. “The non-scheduled private operators like us are unable to afford the losses. The government will have to look into these aspects, or else the airline industry will fall apart,” said Gupta.

However, the government plans a dedicated regional air carrier for the northeastern states. Three airlines have bid for operating this.

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