Logistics

‘It’s only a temporary demand-supply mismatch in aviation, not a slowdown’

Forum Gandhi Mumbai | Updated on August 21, 2019 Published on August 21, 2019

William Boulter, Chief Commercial Officer, IndiGo,

William Boulter, Chief Commercial Officer, IndiGo, is bullish on the Indian aviation industry despite recent headwinds. Over the past one-year, IndiGo has expanded in both domestic and international markets. In an interaction with BusinessLine, Boulter shared his thoughts on the recent slowdown, and how IndiGo is strategically combating it .

What are the reasons for this prolonged slowdown in the aviation industry and how long will this last?

At the outset, I would like to say that this is not a slowdown for the aviation industry. It was a temporary mismatch of demand and supply during January-March 2019. The decline in passenger traffic followed the increase in airfares due to lower number of flights owing to multiple issues. India is a dynamic and competitive industry in terms of aviation, wherein the suspension of operations of one of the major player fuelled the revenue and expansion plans for other airlines. At this point, most of the other airlines have increased capacity to cater to the demand, and we should see the growth figures improving from hereon.

Do you see any job cuts due to the slowdown?

As mentioned earlier, we are rapidly expanding our presence within India and internationally. And the only thing on our mind right now is to get the right talent to complement our expansion plans. In fact, we are launching our second ifly learning academy in Bengaluru soon.

What are you doing to tide over this difficult phase?

For IndiGo, it is business as usual owing to our existing cash reserve and business model which has helped us stay healthy and strong financially. In fact, we are expanding more aggressively both, domestically and internationally. Over the past one year, IndiGo has added 19 new destinations to its network, of which seven were domestic, while 12 were international.

There was a void in the aviation industry after Jet Airways shut operations. How are you filling this void?

The void has not just been in terms of slots but also the passenger traffic that flies on it. With our affordable services, all players — while vying for the slots — are also pulling in the passenger footfall under their services. It isn’t just about the slot, but also about pulling the passengers with the help of competitive pricing. In IndiGo’s case, our large network and strategy fuelled with scale of economies have helped us fill the void in a different way.

Focussed on our expansion, we have added overall 119 new flights and opened 5 new international markets in 2019-20. We are bullish on the Indian travel market and see huge potential for growth over the next three years.

Foreign tourist arrivals (FTAs) in 2018 stood at 10.6 million compared to 10.4 million in 2017. Does the company see any impact of the Indian aviation industry on FTAs?

Over the past few months, we have seen a number of codeshare agreements between Indian and foreign airlines, which hold a huge potential to bring more FTAs to the country. Additionally, we expect to see a lot of Buddhist traffic from India as well as China, Myanmar and Vietnam. We believe that India presents an immense opportunity for tourism with increase in accessibility.

Published on August 21, 2019
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