May 2, 2018, © Leeham News: Spicejet, the Indian low-cost airline, in its 2016-2017 Annual Report (to March 31) didn’t mince words or try to parse over its troubled history:
“Back after near shutdown. Restoring confidence. Organisational restructuring. Rising crude prices.Stiff competition. Legacy issues. We were determined to transform.”
These words are on the first page of the Annual Report.
Name another airline that is so up-front, open and candid about its past turmoil.
Spicejet didn’t stop there.
“From dwindling reputation to India’s most preferred airline. From running on losses to clearing-off existing debts, generating excess cash flows, and regaining customer and consumer confidence. From inability to control costs to lowest-in-the-industry cost model. From unpredictable operations to industry defining operational parameters and customer satisfaction levels. From lacklustre stock performance to highest in the airline industry returns in the world. From investors shying away to investors bullish on us.”
From there, it’s Annual Report reverts to the traditional self-promotion, but Spicejet can’t be blamed for tooting its own horn.
For years, Spicejet was on LNC’s Storm Warning Flag list as a carrier to watch because of huge losses and over-ordering airplanes.
In just two years, the airline turned around from near-extinction to a profitable carrier to become India’s third largest domestic carrier, after Indigo and Jet Airways and slightly ahead of Air India’s domestic share.
Spicejet is a solid Boeing customer, with 142 737s on order. Jet Airways last month announced an order for 75 737s, enabling it to surpass Spicejet’s backlog with 202 737s and 10 787s. Indigo remains the market leader for backlog, with 398 Airbus A320s on order.
For regional routes, it uses the Bombardier Q400. An order for 25+25 placed last year at the Paris Air Show breathed new life into the struggling program.
The 12-year old airline serves more than 50 cities.