SANJAY AGGARWAL, 41 DESIGNATION: Chief Executive Officer, SpiceJet EDUCATION: BS in industrial engineering (Nagpur University), MBA (Bhopal University) and MS in industrial and systems engineering (Virginia Tech, US) WORK PROFILE: Spent about 16 years in the US, almost 11 of which were spent in aviation companies such as US Airways and private jetliner Flight Options

He was accompanied by his wife Hillary and his security detail. The company’s policy was that all passengers should have valid photo identification cards. The pilot asked Clinton for his ID (driver’s licence), which he did not have. Hillary showed hers and asked that they be allowed to depart. The pilot refused. The couple was permitted to depart only after Aggarwal intervened. Later, says Aggarwal, the company wrote a letter to the Transportation Security Administration (TSA) for an exemption for ex-Presidents from showing their IDs when accompanied by their security detail. The request, he says, was gracefully declined by the TSA.

Compare that with India where the list of VIPs who can bypass security at airports is long and growing; where rules are rules for all except the rule makers; and where there are archaic and often inexplicable regulations, no matter which area of business you are in.

What then could possibly convince 41-year-old Aggarwal to leave his cushy existence in the US — where he stayed for 16 years working for aviation companies — and move bag and baggage to take over the reins of SpiceJet, a small low-cost airline in India?

The timing too was hardly felicitous. In 2008, when Aggarwal made the move, the Indian aviation industry was going through one of its worst phases — it had been suffering severe losses since early 2007. SpiceJet itself — which had got off to a good start — was reeling under a mini crisis of its own. The airline was drifting with former CEO Siddhant Sharma on his way out. And daily rumours about investors wanting out only made matters worse.

But for a man who must have a challenge to keep him ticking, India did not sound as bad as one might think. His children, who had seen things come to them easily in the US, would get a taste of the not-so-easy (he says his daughter refuses to waste food on her plate here in India; in the US she would not have thought twice). His wife who hated the cold would get a taste of — well — Delhi’s unique heat.

It took a bit more of convincing on the part of a persistent head hunter, but Aggarwal’s meeting in London with Wilbur Ross — one of SpiceJet’s largest investors — assured him that Ross was in it for a long haul. Further meetings with Bhulo Kansagra, who holds 14 per cent stake in the airline, gave Aggarwal the final push he needed.

Despite the “oh god, the sky is falling” reporting he saw in Indian newspapers and media on India’s aviation, Aggarwal was certain there was light at the end of the tunnel. Aviation, he says, typically grows 1.2 to 1.8 times GDP. But India’s aviation was growing at unrealistic 25-30 per cent rates. “You can see such growth rates as long as there is a pent-up demand, but this cannot continue forever.” Nevertheless, he says aviation will still grow in India at about 13-14 per cent a year. When the industry grows at 13-14 per cent, the low-cost carriers grow at a slightly higher rate (16-17 per cent) than the full-service carriers — that has been the global trend. So, there is no reason to panic. “The sky is definitely not falling,” he says cheerfully, looking up to affirm his belief.

Fixing The Basics
The going has not been particularly easy. When Aggarwal took charge, the airline’s market share had dipped below 8 per cent. Its keenest rival IndiGo, which started well after SpiceJet, had a lead in terms of market share.

Like many other travellers, yours truely had stopped flying SpiceJet in the last year or so as the airline appeared to be headed nowhere in particular (about to be sold any day), and IndiGo seemed like a safer and better option.

“I cannot deny that SpiceJet somewhere along the way did lose its original momentum,” says Aggarwal. When he took over, he found the airline did not know where it wanted to go and “if you don’t know what you want, even God cannot help you”.

Aggarwal set about setting things right — he had done it for years in US Airways where he was an internal consultant — by first fixing the product. (“The difference between internal and external consultants is that as an internal consultant you have to be honest about your recommendations. You have to implement that beautiful report you produced”)

Aggarwal says he started with the basics. “You see a dirty airplane — unexplained things hanging — and you don’t want to fly the airline again. There were torn carpets in our airplanes right under our noses and everyone was looking away,” he recalls. Employee morale was also at an all-time low with rumours of sell-offs. “We re-energised the team, explained that mediocrity will not be accepted, and we have stopped unrealistic promotions,” says Aggarwal.

The results are now there for anyone to see. The market share of the airline has inched up back to around 12 per cent, according to the Directorate General of Civil Aviation (DGCA) data. In February and March, the airline carried five more passengers per departure than its rival IndiGo. Its load share is lower, though, as it has more seats per plane. “You offer the right product at the right time and at the right price, and there is no reason why it won’t work. Aviation is not rocket science.”

SpiceJet is one of the few airlines in India that is currently hiring (in fact the day I met Aggarwal in his Gurgaon headquarters, the reception was teeming with would-be crew and air hostesses). Over the next few months, around 60 pilots will be hired in addition to cabin crew and call centre personnel. In the next two-and-a-half years, with nine airplanes coming, the hiring drive is likely to continue.

I ask if his airline is open to growth through a merger — rumours of SpiceJet “talking to”, “buying”, “selling” never stop appearing in the media. He says the airline is open to the idea though no one is likely to hear of it till it happens. “Who will tell you about a deal like this before it happens?” he asks. The endless speculation one sees in aviation reporting in India amazes him.

Aggarwal says SpiceJet is not looking for cash, not looking to dilute, has no outstandings — so his is a tightly run ship. It is, however, examining whether it makes sense to go international (as per rules, it can start flying international from 2010), and whether it makes sense to offer more regional connectivity (tier 2 to tier 2 cities). “We are doing a lot of strategic analysis and we now know where we are going.” Now, it is up to him to ensure SpiceJet reaches its destination.

anjulibhargava at gmail dot com

(Busineeworld Issue Dated 16-22 June 2009)