Low-cost carrier SpiceJet has signed a memorandum of understanding (MoU) with Japan's Setouchi Holdings for starting an amphibian plane service in India.
The airline plans to purchase at least 100 amphibian planes, which can operate on water as well as on land, to boost regional operations, its chief Ajay Singh said in Guwahati on Wednesday.
The list price of each aircraft stands around $4 million, which means the fleet of around 100 aircraft would cost around $400 million. The company is seeking low-interest loans from Japan, similar to the one provided for the bullet train which is to connect Mumbai with Ahmedabad.
The single pilot, 10-14 seater, amphibian planes have the ability to take off and land from places where there is no other mode of transport available and would therefore come handy in places which are unconnected by air due to infrastructure challenges.
"We are studying the commercial viability (of this project). SpiceJet will get involved whatever the structure might be... directly, separately or as part of travel vertical," Singh, the airline's chairman and managing director, told reporters, adding that the interests of states in the service have also to be assessed.
He said if things move ahead, then the project would be done in one year.
Quest Aircraft Company LLC, part of Japan's diversified Tsuneishi Group, is a manufacturer of amphibian planes. The company is owned by Setouchi Holdings, part of the Tsuneishi Group, which is also one of the world's largest shipbuilders.
An official with the Japanese company said that there is also a proposal to connect Mumbai's business district of Nariman Point with the suburbs. A similar attempt through a seaplane had failed earlier primarily due to permissions, though some routes connecting Juhu airport to Lonavla and Nashik did materialise for a short time.
When asked how SpiceJet expects to operate in a country when many other similar initiatives in the past have failed, Singh said," I think a few initiatives failed because it could not scale up. Having just 2-3 aircraft, their business could not become profitable."
Singh, who is credited with turning around SpiceJet from near closure, said, "We will get into it only if makes commercial sense to us."
According to Singh, all its flights operating under the regional connectivity scheme (RCS) – also known as UDAN (Ude Desh Ka Aam Naagrik) - are breaking even with over 90 per cent load factors.
When asked to react to allegations that RCS is happening in election-bound states in order to help the Bharatiya Janta Party, Singh denied it.
Go Okazaki, executive managing director of Setouchi Holdings, said, "Under this association, we have already executed land plane demonstrations in Nagpur and Guwahati. As a next step, we would also like to go for seaplane demonstration soon."
According to the company sources, officials from SpiceJet and Setouchi Holdings had meetings with the senior leaderships and they have assured of quick mandatory clearances.
On an ambitious expansion path, SpiceJet has this year announced plans to order 225 planes from Boeing and another up to 50 aircraft from Bombardier.
The airline operates an average of 384 daily flights, with a fleet of 35 Boeing 737NG and 20 Bombardier Q- 400 planes.