Nick Parker, Head of India and Middle East for Virgin Atlantic, talks about the measures that can enable Indian aviation to reach its full potential as well as the airline’s positioning in the India market
Virgin Atlantic is looking at opportunities to grow and strengthen its network and will continue to evaluate new destinations across India and Asia.
How would you see the emerging scenario in Indian aviation sector?
The Indian aviation industry is growing at an exceptional rate. It promises huge growth potential due to large and growing middle class population, rapid economic growth, higher disposable incomes, and overall low penetration levels. High quality new entrants in the aviation market mean that this is a good time for the consumer with the additional competition between carriers. The future for the industry should be very bright provided lessons from the past are learnt where businesses are run in sustainable ways. A reformed supportive and evolving regulatory framework that encourages competition, removes outdated, unnecessary, anti-competitive practices and protectionism without comprising on safety and security are essential if Indian Aviation is to reach its full potential.
Looking ahead, there are positive external factors such as lower fuel prices, while India’s economic outlook also continues to improve. With robust traffic growth and modest capacity expansion, carriers should see a further improvement.
While other carriers are expanding their wings in India, you are flying only one destination in India. What is the main reason for this? Is there any plan to reinstate Mumbai route again?
Virgin Atlantic is committed to serving India, which was been an important part of our network since we started our Delhi/London route in July 2000. Although we ceased our own Mumbai/London route last year we have also extended our code share partnership with Jet Airways offering a double daily flight option between Mumbai and London to connect on to our extensive US network of over 200 destinations. Additionally, we have further extended this code share relationship with Jet Airways to include flights originating in Bengaluru, Hyderabad, Chennai and Kolkata. Through our focus on improving our codeshare agreements, we have effectively increased our footprint within India, making it even easier for people across India and the sub-continent to experience our award winning service.
We are always looking at opportunities to grow and strengthen our network, and will continue to evaluate new destinations across India and Asia. However like all airlines operating out of London Heathrow and Gatwick, we are constrained by the lack of take-off and landing slots available – and this means that any new route represents a major investment and needs to be profitable from the outset.
How has been the year 2015 for Virgin Atlantic in India in terms of load factor and yields? What is the expectation from 2016?
In 2015, our Delhi London route was one of our first routes that we deployed our brand new 787-9Dreamliner on and the feedback is that our customers absolutely love it. The aircraft is also a better configuration for our Delhi route which is another positive for both yields and load factor. These factors combined with consistently high levels of service and a loyal customer base in India contributed to a successful 2015, and we are confident this will continue in 2016.
What percentage of Indian traffic do you expect to go beyond your hub in London?
While many customers do connect on to our extensive and expanding US network including New York, Atlanta and Detroit we are in the privileged position that customers and trade partners have a special trust in Virgin Atlantic so we have particularly strong commitment on the Delhi/London route through both direct and indirect channels. The unique cultural links between India and UK including the high levels of Indian diaspora in the UK makes India an important point to point route in its own right to us rather than thinking of it as a feeder/catchment market – with our focus on the customer it’s a route on which we thrive.
You have always been coming out with excellent innovations. Could you please share some latest innovations/ product and service enhancements with us related to the Indian market?
Our CEO has set us very clear objectives which are of absolute equal importance, to achieve record levels of profitability and to deliver record standards of customer experience. One component of this is our fleet modernization which we are part way through and in April 2015Virgin Atlantic became the first European airline to introduce the state of the art 787-9 Dreamliner between Delhi and London.
The Dreamliner boasts a range of enhanced customer experiences includingWi-Fi on every aircraft and the latest in-flight entertainment system- Vera Touch 2-offeringover 400 hours of on demand Hollywood and Bollywood entertainment. Mood lighting creates a relaxing ambience on board, and cleaner air coupled with a lower cabin altitude means customers arrive at their destination feeling more comfortable and refreshed.
We have begun a £300m investment into customer experience which is expected to be completed by 2018, focused on areas that are important enhancements, including our food and beverage on-board and rolling out Wi-Fi across our fleet.
How would you explain the operating conditions for foreign airlines in India in the wake of higher landing and parking fees at Delhi airport?
Anything that adds additional, unnecessary cost to the price of the customer ticket only serves to damage the industry and stifle the full potential economic benefits to the surrounding economy. Numerous studies show how the loss of broader economic benefit from reduced tourism, trade and commerce far outweighs the total revenue collected through distorted and unjust charges, such as the UK’s Air Passenger Duty. The exciting thing for Indian Aviation is that all the key components to have a truly competitive and thriving industry exist here in this country, the opportunity and benefits of reform are so huge it has to happen.