Captain GR Gopinath plans to return to the aviation business by launching a regional airline. The man who made flying cheaper through his low-cost airline Air Deccan and later sold it to Vijay Mallya-owned Kingfisher Airlines is in talks with international vendors to develop software for a scheduled airline (an airline that operates services according to a time-table),as per a report in the Economic Times. Gopinath plans to first target the growing regional market and connect metros through a national carrier.
"I want to start a regional airline and then also expand it to the trunk national routes, but this will take awhile," said Gopinath. "I need another 10 years of energy and also cash flow is an issue." But his entry into the aviation business is likely to transpire towards the end of 2012 when his five-year non-compete clause, signed at the time of selling stake to Mallya, ends. Till such time, he will follow the strategy of simultaneously developing the groundwork for the airline and strengthening non-schedule operations which received no-objection certificate from the government, according to three senior aviation industry officials.
He may find it tough to raise cash for his new venture as bankers are not very keen on lending money to the booming aviation business due to its volatile nature. Air Deccan was sold to Mallya in 2007 after suffering huge losses.
" In this business, reputations run deep and in this sense Gopinath will start with a credibility deficit. Post the Air Deccan stake sale, his financial prudence is questionable and he was also not able to get the desired footfall for his venture" said an aviation analyst with a large consultancy and advisory firm who did not want to be identified. Also, in his second innings, the pioneer of low-cost airline might have to pull a different strategy to be successful as the aviation scene is very different for budget airlines now. "The low-cost space is crowded and Gopinath will have to come up with a unique proposition to be successful," the analyst added.
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