Indian domestic airlines carried over 1.01 crore passengers in August, a 51 per cent rise year-on-year (y-o-y); and a 4 per cent jump over the July numbers, data released by the country’s civil aviation regulator, Directorate General of Civil Aviation (DGCA) showed.
Carriers flew 97 lakh-odd in July this year and 67 lakh in August 2021.
During the January to August period of this year, around7.70 crore people opted for Indian carriers, up 68 per cent over the same period last year. In January–August 2021, domestic air traffic was 4.60 crore – odd.
According to Satyendra Pandey, Managing Partner of aviation advisory firm AT-TV, the increase in numbers is driven by the removal of the price floors, which hasenabled airlines to go and offer discounts. As such, the discounting has stimulated the whole scenario of travellers who were otherwise priced out of the market.
“Passenger numbers have to be seen in the context. Profitability for most airlines continues to be elusive and multiple challenges abound. Fixing these means addressing significant structural issues head-on. Failing that, the market may very likely see airline failure or worse, the situation of zombie lending which then has consequential impact across the industry,” he told BusinessLine.
Load factor improves
Passenger load factor for the major airlines varied between 65.5 per cent and 84.4 per cent. Almost all airlines - IndiGo, Vistara, Go First, Air India — reported an improvement in passenger load factor, while in case of others like SpiceJet, numbers remained more or less constant. Air Asia and Alliance Air saw passenger load factor drop.
Vistara had the highest passenger load factor for the month at 84.4 per cent. New entrant, Akasa Air had 52.9 per cent load factor.
“The load factors also show a steady uptick though these are to be seen with caution as they are net of clubbing and cancellation. By way of example, if an airline flies three times between Delhi and Mumbai, but ends up consolidating three flights on to one flight — while the load factor registered is high, it masks the fact that the other two flights have not operated,” Pandey of AT-TV explained.
According to the DGCA data, IndiGo continued to have the dominant market share at 57.7 per cent in August; however, it lost 1.1 percentage point market share over July (58.8 per cent).
Vistara, the second largest player in India by market share had 9.7 per cent market share last month, down by 0.7 percentage point over July (10.4 per cent).
SpiceJet had a market share of 7.9 per cent (same as the previous month).
Air India and Air Asia improved their market shares to 8.5 per cent and 5.8 per cent (from 8.4 per cent and 4.6 per cent in July), respectively.
Akasa Air, which began operations August 7 onwards, has 0.2 per cent market share.