I am back at SpiceJet for long run: Ajay Singh

SpiceJet’s founder-cum-promoter Ajay Singh is all set to infuse another tranche of Rs 400 crore by mid-May, on top of Rs 550 crore he invested after taking over the airline earlier this year. Singh is busy cleaning up the mess left behind by the previous owner, Sun Group. The ‘costly’ top brass has been shown the door. A few top-level people brought in by the past management are continuing mainly due to their expensive exit clauses but they could be out soon to make way for the co-founder’s trusted team.Singh spoke to TOI on the challenges faced by the airline. Excerpts:
How will you arrange funding beyond the Rs 1,000-odd crore infused by May?
This money has come from a mix of investors and banks. We are getting a lot of funding offers from various players like private equity, debt providers, hybrid products and even foreign airlines. We will choose the mode of investment that comes at the lowest cost. If any further dilution of stake is needed, that will be done at better valuation. Our improved performance will reflect in our stock price.
Being a low-cost carrier (LCC), will SpiceJet continue to have a mix of Bombardier Q400s and Boeing 737s?
We have renegotiated several contracts with Bombardier for the Q400. I will give this aircraft two more quarters. If they are able to give us profits in that time period, then they can stay. As of now, we have 14 Q400s and 20 B-737s. We will add at least two-to-three 737s this summer.
Is the fleet downsizing and the consequent staff rationalization over?
From 5,500 employees, we are now down to 3,900. I don’t see any great need for further downsizing. As the airline grows again, the employees, who have been temporarily asked to go, will be given the first chance to return.
SpiceJet was known for offering frequent promotional sales under the previous owner...
Promotional sales are a part and parcel of LCCs world over. They enable people, who have never flown before, to take to the skies. However, they should not be indiscriminate and revenue-dilutive. The sales SpiceJet had in 2013 were very poorly designed.
What changes have been effected since taking over?
SpiceJet was serving 39 airports. That number is now down to 31. As we add planes, we will not open new stations but add frequency to existing places. We have worked on our on-time performance, which improved substantially in last two months.
How would you describe SpiceJet’s condition now?
I am back in the airline for the long run. We are not yet out of woods but we have made a lot of improvements since February. We have cleared all statutory dues, bank debt and are current on salary. It is painful to see what the airline has gone through. I could have formed a new airline with no liabilities but being the co-founder of SpiceJet, I didn’t want this airline to collapse. Hence, I am back.