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Is India’s Latest Airline Startup Doomed to Fail?

Staff members at the launch of the brand name “Vistara”—a Sanskrit word denoting limitless expanse—for the new airline in New Delhi on Aug. 11
Staff members at the launch of the brand name “Vistara”—a Sanskrit word denoting limitless expanse—for the new airline in New Delhi on Aug. 11Photograph by Chandan Khanna/AFP/Getty Images

India’s aviation market is notoriously challenging. High fuel taxes and airport fees drive up costs while cheap fares proliferate. Into this tumult comes a new player, Vistara, which aims to start flights in October in a country where airlines have tallied almost $10 billion in losses since 2007.

The main difference at Vistara? Premium service. One of the world’s highest-rated carriers, Singapore Airlines, owns 49 percent in a joint venture with Tata Sons. Vistara will target business-class travelers, an arena where higher fares could help it overcome some of India’s expensive structural costs. It’s starting with five Airbus planes this year and plans to grow to 20 in coming years.