Kochi, Kerala’s busiest airport, has been chosen as the hub for a new airline set to launch operations using ATR-72 turboprop aircraft. Named Air Kerala, this initiative marks the revival of a longstanding aspiration for the state to have its own airline, albeit amid challenges.
According to a former CEO of a budget airline, the startup faces the dual challenge of managing operational costs and competing against established carriers operating larger capacity aircraft into the state. He suggested that state support, in terms of cost concessions and revenue guarantees, could bolster the fledgling airline’s prospects.
Air Kerala is spearheaded by UAE-based businessmen Afi Ahmed and Ayub Kallada, and has received preliminary clearance from the civil aviation ministry. Ahmed expressed optimism about commencing operations by the first quarter of CY 2025 with an initial investment ranging from ₹60-100 crore. The airline plans to launch with three ATR-72 aircraft and is in the process of securing an air operator permit while finalizing key personnel appointments.
The airline’s strategy focuses on connecting routes within Kerala and to other tier II and III cities like Salem, Madurai, Hubli, and Pune, based on market demand. It has mapped out a connectivity plan encompassing 53 airports and aims to hire 350 employees within its first year.
Currently, Kerala hosts four airports—Kannur, Kochi, Kozhikode, and Thiruvananthapuram—with international traffic outweighing domestic. Nonetheless, domestic traffic is on the rise, notably with Thiruvananthapuram experiencing a 40% increase in domestic passengers over the past year, while Kannur recorded the slowest growth at 2.3%. Kochi and Kozhikode airports saw growth rates of 17.4% and 11.3% respectively.
Air Kerala aims to capitalize on intra-state travel demand, leveraging its fleet of ATR-72s. Industry experts acknowledge the challenges ahead, citing the need for government support and strategic alliances with local tourism and wellness sectors to ensure competitive edge and sustainability.
Despite concerns over operating costs and capacity limitations inherent to ATR aircraft, proponents remain optimistic about Air Kerala’s potential to carve out a niche in Kerala’s aviation landscape. They anticipate that government initiatives, including potential cost concessions and revenue guarantees, will play a crucial role in the airline’s early viability and growth.