News

Chennai-based regional carrier Paramount Airways plans to start international operations by 2011. Managing Director M. Thiagarajan declared: As soon as we finish five years of operations in 2010, we plan to start international operations. Paramount Airways initially hopes to explore direct flight operations to select destinations on the lucrative European and US sectors. As part of its preparation to fly international, Paramount is currently holding final negotiations with US aerospace major Boeing and Toulouse-based aircraft manufacturer Airbus for acquiring at least 10 wide-bodied planes. An official said the airline is actively considering Boeing’s B 777 family of planes or Airbus A 330 as its final choice. The deal is likely to materialise and an announcement may be made during the ongoing Singapore Air Show 2008.

Views

Launched on October 19, 2005, Chennai-based Paramount Airways is a low-cost airline in the private sector. Owned by Madurai-based textile giant, the Paramount Group, the airline is unique on a number of counts. Unlike other low cost or full service airlines in India, its aircraft are configured to a combination of only first and business class sections catering to a narrow segment of the society. The airline offers good value for money at highly competitive prices. Also, Paramount Airways is the only airline in India to operate the Brazilian Embraer family of aircraft.

Over the last two-and-a-half years of existence, Paramount Airways has managed to build up its fleet to just five aircraft. In this period, the airline has essentially been validating its exclusive but somewhat doubtful business model. Adopting an extremely conservative approach, the airline has resorted to scaling down operations cutting out non-profitable sectors confining operations to southern India to focus on profitability.

Whether or not the business model adopted by the airline is successful, cannot be stated with any degree of certainty as the cumulative losses suffered by all airlines in India by the end of the financial year 2006-07 is estimated to be in the region of $700 million (Rs 2,800 crore). It is unlikely that any airline, least of all Paramount Airways with its rather difficult business model, is truly out of the red, claims to the contrary by the airline management notwithstanding.