Vistara is in talks to delay some of its aircraft deliveries, citing the current market and production delays. The airline currently has orders for the 787 and A320 family, from Boeing, Airbus, and lessors. However, Vistara will take delivery of three more aircraft this year, including one more Dreamliner.
Slowing market
In his comments to the press, Vistara’s Chief Strategy Officer Vinod Kannan said the decision to defer deliveries is not only due to production delays, but also commercial reasons. The airline has been hit hard by the COVID-19 pandemic, with financial pressure and its long-haul ambitions on hold.
Due to current restrictions, the airline is flying only a handful of routes with around 1/3rd of its fleet (around 13 aircraft). Demand has been low too, with Vistara seeing around an average of 50-60% passenger load since domestic flights resumed. With international flights still banned, Vistara has been unable to deploy its brand-new Dreamliner on any long-haul routes, only using it a few times for high-demand domestic flights.
Vistara has also not participated heavily in the Vande Bharat Mission, only operating some flights from Singapore. It is currently unknown if it will participate in Phase 4 of the mission, while other private carriers have rushed to take up flights.
All of these factors have resulted in the airline struggling to generate revenue and expand operations. While it has enacted pay cuts and unpaid leave across the company, the airline has refrained from laying off employees.
Only three new aircraft this year
As a part of its new business plans, Vistara has significantly scaled back the number of planes it will add to its fleet. The airline will add one more 787 and two A320s this year. Vistara had plans to add 6 Dreamliners between 2020 and 2021, but these plans are likely delayed now.
These aircraft are likely the three which have already been painted and are ready to go at Boeing and Airbus facilities in Everett and Hamburg, respectively. According to Planespotters.net, Vistara’s second 787 (registration VT-TSE) and two A320s (VT-TVA and VT-TVB) are waiting on the ground to be delivered.
Boeing test flight of Vistara 787-9, VT-TSE, flew PAE👉PDX👉PAE and did a number of touch and goes using both directions of the PAE runway. BOE416 Heavy on 1 Jun 2020.#Vistara #spotvistara #VTTSE #Boeing #Boeing787 #b787 #Dreamliner #PAE pic.twitter.com/LbVr7Av1Ha
— Katie Bailey (@KPAE_Spotter) June 3, 2020
Overall, the decision to defer deliveries will impact Vistara’s long-term goals. The airline planned to double its international destinations this year and induct a large mix of widebodies and narrowbodies. The delay could mean current aircraft deliveries extend into 2024.
Airline remains safe
While the order delay might have slowed Vistara’s growth ambition, it still remains financially sound. While Vistara has struggled with losses since the start, backing from both the Tata Group and Singapore Airlines ensures that the airline will survive this current downturn. However, grand plans, such as investing in Air India, have likely been shelved.
The coming weeks will give us more details on Vistara’s new delivery schedule and future plans. However, with sound finances, the airline is still on track to become a major Indian carrier, albeit slightly later. Until then, it seems Vistara is hoping for a quick rebound after international flights resume, with its passengers willing to fly soon.
What do you think about Vistara’s delayed plane deliveries? Will the airline go long-haul this year? Let us know in the comments.
