“At the moment we are talking to prospective girlfriends”
Prospective investors, mainly airline companies but also financial investors, have exhibited interest in investing in low-cost carrier, SpiceJet, according to CEO, Neil Mills.
“There is very real interest, particularly in SpiceJet as a carrier, and some interest in India as a destination. But the issue is the current cost structure for the industry in India. I have spoken to a couple of carriers and there is definite interest,” said Mr. Mills in an interview to The Hindu in New Delhi recently.
He cautioned however that these “deals don’t happen overnight”. “Airlines around the world have their own issues now and we are not desperate for cash,” Mr. Mills said, adding: “At the moment we are talking to prospective girlfriends, you cannot say I’m getting married just that bit. It’s not even dating, that will be when due diligence happens.”
Analysts have named SpiceJet as one of those most likely to attract a foreign investor quickly. Meanwhile, the airline is getting ready to import its own fuel to save costs. It is in the process of securing final approvals and the order for the first parcel of 10,000 kilo litres is likely to be made in the next six weeks. Asked if it was not a cumbersome process, Mr. Mills said: “We actually have nine separate commercial agreements to manage the transportation of the fuel from its origin to its destination in the aircraft’s fuel tank. This is not easy but it’s not impossible either. I have done this once before in a previous job where I imported fuel from Russia into Italy.”
Mr. Mills agreed that it will only be a “small relief” in terms of costs but pointed out that last year the airline spent Rs.2,200 crore on fuel. “If I can save 1 per cent of that (Rs.22 crore) I’m obliged to do it as the CEO.”
Things are beginning to look up for the airline industry just that wee bit, according to Mr. Mills.