Just when the airline sector is staring at runaway operational expenses worsened by a weak rupee, a little-known business group from the Andhra Pradesh, India, town of Vijayawada has entered the money-guzzling business.
Its regional airline – Air Costa, the first to be set up under the government of India’s regional airline policy in South India – takes to air with two Embraer jets today. The airline will be headquartered at Vijayawada and have Chennai as its maintenance center.
This start-up comes seven years after the launch of Paramount Airways, which too flew Embraer jets. Air Costa has plans to invest about Rs 610 crore over the next two years. The airline has taken delivery of two E-170 jets and, will add two more E-190 jets in November. In all, Air Costa plans to have 10 E-190 jets by end of 2014, and take the total fleet size to 25 by 2018 in phases.
For the complete story by K.R. Balasubramanyam of Business Today (India), click here.