India’s largest airline, IndiGo, continues to grapple with operational crises. Yesterday, on December 5, more than 1000 IndiGo flights were cancelled, causing chaos at most airports across the country. More than 1700 flights have been canceled in the last four days alone. It is believed that this problem may persist for some time. According to the company, today, even on 6th December, around 1000 IndiGo flights may get cancelled. Due to shortage of staff and technical management problems in IndiGo, hundreds of passengers are stranded in big cities like Delhi, Mumbai, Ahmedabad, Jaipur, Indore, Kochi and Thiruvananthapuram.
Amidst this IndiGo crisis, many people are also wondering how much it will cost to start their own airline company and what is the licensing process. So, today we will tell you about the expenses involved in starting an airline company, from getting a license to purchasing an aircraft, and the processes involved.
How much does it cost to start an airline in India?
The aviation sector is considered one of the most expensive businesses in the world. From purchasing or leasing the aircraft to staff, technical team, ground setup, airport slots, maintenance, fuel cost and adhering to DGCA regulations, there is a lot of expenditure at every level. This is why the initial investment to start an airline is very high, and only financially strong companies can afford it. India’s aviation sector is the 9th largest sector in the world and contributes more than ₹18.32 lakh crore to the annual GDP. Starting an aviation company requires an investment of crores of rupees.
What is the licensing process in the aviation sector?
To start an airline in India, several necessary permissions are required from DGCA (Directorate General of Civil Aviation). This includes processes such as obtaining an air operator certificate, security clearance, verification of pilot and technical staff qualifications, and safety audits. This entire process takes place in several stages, and all the technical requirements have to be met as per the rules. This entire process may take approximately 18 months to 3 years. Even after getting a license, the airline has to maintain consistent safety and service standards.
How much does it cost to buy an aircraft?
The biggest expense for any airline company is its aircraft. Most companies around the world initially lease planes rather than buy them, as a single plane can cost hundreds of crores of rupees. Even in taking a plane lease, a lot of payment has to be made every month. Maintenance, insurance and technical support also cost separately. In India, it may take at least Rs 500 to Rs 1500 crore to start an airline. However, this figure may vary depending on the airline’s size, routes, fleet and business model.