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GoAir said it will become an Ultra Low-Cost Carrier. What the heck is that?

Like all other carriers, GoAir is at best a low-fare carrier and not a low-cost carrier since every other trick in the book to keep costs low are absent in India.

March 26, 2021 / 05:05 PM IST
The logo of GoAir airline is pictured on an A320neo aircraft at the builder's headquarters of Airbus in Colomiers near Toulouse, France, November 15, 2019 (Reuters)

The logo of GoAir airline is pictured on an A320neo aircraft at the builder's headquarters of Airbus in Colomiers near Toulouse, France, November 15, 2019 (Reuters)

Early this week, Go Air, the Wadia group-backed and the Mumbai-headquartered airlines, said that its Managing Director Jeh Wadia would step down. The airline elevated Ben Baldanza as its Vice-Chairman. More often than not the airline has been in the news for unceremonious exits of CEOs as news of its IPO gathers pace for probably the “n”th time. Incidentally, the company in its search for a new CEO landed up handing over the job to Kaushik Khona, who had led the airline in its last turnaround phase, a decade ago!

While many had written off the airline years ago, the airline has survived each and every crisis, so far. And while the airline has remained around the 10 percent market share mark, rival IndiGo that started later than GoAir is over five times its fleet and has over half the market share in the country. The airline may have often been accused of remaining small, but is it its nimble size that has helped the airline stay afloat during turbulent times? With the impact of slowdown, lockdown or fuel hike being the lowest in absolute terms, what can the group do to ensure that the entity stays afloat?

Baldanza is not new to the airline, its management or the country. He has been around as an adviser since 2018 and has handled various responsibilities. His tenure with the group already exceeds that of many CEOs the company has had.

However, the interesting part of the press statement from the company has been that the airline plans to move towards being an Ultra Low Cost Carrier (ULCC). Baldanza took Spirit public and transitioned it to ULCC as its CEO.