FitsAir eyes major expansion in domestic and int’l operations

With the vaccines against the coronavirus gaining momentum in Sri Lanka and across the globe, Fits Aviation (Pvt.) Limited (FitsAir), Sri Lanka’s sole private sector-owned airline with operations in both cargo and passenger segments, eyes major expansions in its domestic and international operations, with a view to support the country’s exporters and to realise the country’s potential in tourism while positing air travel as a viable transport mode for Sri Lankans, who are increasingly becoming time-conscious. 

In 1997, FitsAir commenced operations with a leased 10-tonne capacity cargo aircraft flying from Sri Lanka to the Maldives, after becoming the first privately operated local carrier to secure the licence for international cargo operations from the Sri Lankan Civil Aviation Authority (CAA).

Three years into operations, it started to extend its cargo operations to India, Pakistan as well as the Middle East, by adding more aircraft to its fleet.

In terms of passenger operations, it started to fly to Jaffna on a charter basis several times daily, with 50-seater passenger aircraft, to provide critical linkage to the peninsula during the civil war. Although the passenger flights to Jaffna came to an end shortly after the civil war, FitsAir commenced its first scheduled passenger operations, offering regular flights to Batticaloa from Colombo (Ratmalana Airport), in 2019. In the following year, it started scheduled flights to Jaffna, becoming the first local airline to 
do so.

With the emergence of the COVID-19 pandemic in early last year, the global passenger airline traffic started to decline to record lows, due to the travel restrictions and low demand, forcing the airlines to temporarily shelve operations or to cut frequencies while the demand for air cargo started to increase at the same time, due to a significant reduction in cargo carried in the belly holds of passenger aircraft, disruption in ocean freight and urgency in shipment of goods such as personal protective equipment (PPE).

With these developments, FitsAir has been moving aggressively to fill the widening gap for air cargo, with an aim to support Sri Lankan exporters to remain competitive in international markets.

FitsAir is a member of Aberdeen Holdings Group of Companies, owned by the Kassim family, the former majority shareholder of Expolanka Holdings PLC.

The key officials of FitsAir, including its Managing Director Shafik Kassim and CEO Omar Kayaam as well as Head of Global Flight Operations Capt. Druvi Perera, joined for a discussion with Mirror Business, last week.

Current status and plans for cargo operations 
With its plans to expand air cargo operations out of Sri Lanka, FitsAir aims to instil stability in the availability and in freight rates for Sri Lankan exporters. 

“With passenger aircraft not operating at the fullest capacity, there’s a shortage of cargo space. The airfreight cost is three to four times what it used to be. Hence, it has become too expensive and it would be extremely difficult for exporters to remain competitive in markets with such high transport costs.

With FitsAir coming up with this type of solutions, we hope to bring some stability in prices and availability. Sometimes, even if you are willing to pay four times of the standard price, there is no space,” Kassim noted.

With the recent developments, he pointed out that air freight has become the preferred option gaining the momentum.

According to the International Air Transport Association (IATA), it is expected to take a minimum of two years for air passenger volumes to reach back to pre-pandemic levels. However, the air cargo volumes are expected to bounce back by end of this year, with the global trade picking up. 

Accordingly, Kayaam believes that FitsAir benefits from its ability to shift aircraft between passenger and cargo to cater to the evolving demand.

Further, the slim organisation structure of the group and company has also been cited as an enabler for the airline to respond to new market developments swiftly, with a fast decision-making process. 

Furthermore, FitsAir also benefits from synergies, being part of Aberdeen Holdings, in particular from the group’s other ventures such as inter-lining operations, which involve global networking cargo movements.

Keeping up with the market trends, FitsAir converted a P2C A321 into a freighter for cargo operations to the Maldives and Dubai last year and most recently, it welcomed the airline’s first Airbus A320-232 to the country, to be inducted to its fleet as a freighter. The engineering arm of SriLankan Airlines would be converting the aircraft and it would be also responsible for the future maintenance.

Kayaam highlighted that an all-Sri Lankan crew would be involved in the operations of the freighter, unlike the previous occasions.

In the coming months and years, it plans to add four to five such new air freighters and passenger aircraft to its fleet, with the second Airbus A320-232 is expected to join the FitsAir fleet in the third week of April. 

International cargo operations
In addition, FitsAir, as an international cargo operator, has presence in several countries, including in the South Asian region as well as Africa, South East Asia and the Middle East.
“Due to the pandemic, most of our bases are at a standstill. However, we continued to operate flying cargo to the Maldives, in spite of COVID-19. We will be reactivating cargo operations,” Kayaam said.

FitsAir has also secured the regulatory approval to carry cargo from Colombo to South India, with the small 12-seater Cessna aircraft.

Commencement of international regular passenger operations
FitsAir was on the verge of commencing its first international scheduled flights from Jaffna to Chennai last year, before the COVID-19 pandemic struck. However, the company assured that it remains committed to its original plans to commence these operations.

“We have also secured the necessary approvals to fly from Jaffna to destinations in India. We will start those operations, once things smoothen up. This would be the first time we will be carrying scheduled international passenger operations out of Sri Lanka,” Kayaam said.

Initially, FitsAir plans to fly thrice a week to Chennai, from Jaffna. However, Perera noted that the airline would also consider the possibility of daily flight operations in the future, due to the anticipated strong demand in particular from business travellers and pilgrims.  

Tourism development is also identified as a key target of scheduled flight operations between the two cities, given the close proximity.

“For Sri Lanka, utilisation of Jaffna, Batticaloa and China Bay Airports and even Mattala Airport, will entirely depend on tourism,” Kayaam stressed.

FitsAir is also focusing on offering services to religious and pilgrim travellers at a low cost, as many such travellers with low budget struggle to find low-cost travel options after Mihin Air ceased its operations.

“That’s where we want to focus on, when it comes to passenger operations. Our purpose is to support the travellers who find it difficult to travel, due to expenses. 

If you look at Bodh Gaya, there’s a massive market of around 80,000 pilgrims per year. There’s no direct flight to Bodh Gaya from Sri Lanka. They have to go via either Chennai or Delhi. Therefore, we are trying to offer a direct service, waving tariffs and go directly,” Perera elaborated. 

International charter flights 
FitsAir also has set eyes to restart charter operations, building up on its strengths and its extensive network in international operations to attract tourists from the key tourism source markets such as India and China to the country, once the pandemic wanes off.

“There are lot of small niche opportunities. Once the pandemic settles down, I’m sure Sri Lana will fire very fast with tourism. We are anticipating fairly decent charter volumes,” Kassim said.

Kayaam believes that Sri Lanka has many unexploited opportunities to be gained through charter operations, benefiting population segments in different income levels. 

Plans for domestic passenger operations 
As the sole remaining domestic scheduled flight operator in Sri Lana, FitsAir aims to position air travel as viable and cost-effective among Sri Lankans, while also utilising it as a tool to attract foreign travellers to the country.

In 2020, the domestic air passenger numbers fell to 8960, from 24,313 passengers in 2019. The sector hasn’t seen a considerable change since 2014, when the number of passengers rose to over 28,000, from 7600 in the previous year.

As a solution, FitsAir plans to open up cost-effective air travel options to price-conscious Sri Lankans, who are also becoming time-conscious. 

As part of the domestic passenger flight operation strategy, Kassim announced that FitsAir plans to commence dirt-strip operations in Sri Lanka, targeting Kandy, Nuwara Eliya as well as destinations in the Eastern province and deep south.

“The government is looking at it very seriously now. It’s a very common operation in Africa, Brazil, Australia, Indonesia, etc. For an example, you can reach Kandy in 20 minutes. We are open to fly six times to Kandy, on a daily basis. That’s the plan,” he elaborated. 

According to the World Bank, Sri Lanka’s fairly underdeveloped domestic aviation market is expected to grow to 337,472 passengers by 2035, still remaining levels below the volumes of some of the developing South East Asian countries such as Cambodia. 

“We want to make it more affordable. Sri Lankans value time today, compared to the past. The value of time is becoming more important. With that understanding, I think people will pay extra to save time,” Kassim opined.  

In addition, he noted that dirt-strip operations could be utilised to move goods quickly at a low cost.

“For an example, banks can move cash to their ATM machines into particular areas, when they expect a spike demand for cash,” he said.

Meanwhile, FitsAir is also planning to offer services to fly patients from Jaffna to hospitals and medical centres within Sri Lanka and in South India, offering the services of an air ambulance, according to Perera.

Given the competitive rates at South Indian hospitals, FitsAir expects that the patients as well as insurance firms will embrace this initiative. 

“It will grow into a fairly decent market,” Perera said.

Key barriers for private sector aviation firms 
The time-consuming regulatory approval processes, which involve multiple state agencies, remain a key barrier for growth in the country’s aviation industry, according to FitsAir.

“The government needs to make the approval process, which involves multiple state agencies, easier for us. We cannot keep an aircraft on ground idling with no good reason because one government is not working on that particular day. Therefore, facilitation is critical. There should be faster facilitation at different divisions,” Kayaam said.

Some of the remaining excessive war-time regulation on the aviation sector has been identified to be another challenge for the industry.

Kassim pointed out that the private sector-led aviation development was the main reason for success of tourism in the Maldives and Sri Lanka’s aviation industry could play a similar role in realising the country’s tourism potential, if an enabling environment is created by removing excessive regulations and other barriers.