Airlines prep for Q3 traffic record
- The festival season, lengthy holidays and the upcoming cricket World Cup are expected to contribute to the high demand in the October-December period
A record number of Indians are expected to fly this December quarter thanks to the festival season, lengthy holidays and the upcoming cricket World Cup, airline executives said.
“We are preparing ourselves for record demand during these three months. Capacity is being inducted accordingly, but the global supply constraints will have some impact on the supply side,” an airline executive said on condition of anonymity, adding that this may lead to higher fares during the quarter.
In every month since January, air travel was higher than the corresponding pre-pandemic period by an average of nearly 8%, official data showed. Despite the grounding of Go First and steep fares, domestic air passenger traffic hit a record in May. During the month, Indian airlines carried over 13.2 million passengers, crossing the previous record of 13.02 million set in December 2019.
“The current scenario indicates that air traffic will set a new record, not only on a monthly basis, but also for the quarter. All stakeholders, including airports, have put plans in place to handle this kind of growth so that we can avoid chaotic situations at airports, especially the metro airports,” a second executive at a low-fare airline said. This includes improving the security check-in process and increasing capacity in other areas.
Rough calculations based on government data show that domestic air passenger traffic in September may be around 12.3 million passengers, or 7% more than the passenger count in the same month of the pre-pandemic year of 2019 and over 18% higher than in September 2022.
“Travel associated with World Cup 2023, which will commence on 5 October and conclude on 19 November, will also act as a catalyst for the domestic air travel momentum,” the second executive added.
Despite steep airfares, demand hasn’t slackened. In April, when Go First was still flying, the number of daily flights stood at around 2,900, with 12.9 million passengers. While the airline’s grounding on 3 May decreased total daily flights by around 100, the number of passengers hit 13.2 million during the same month.
To make sure they can service the demand, airlines have also started preparations to induct aircraft on wet lease as new aircraft come in slower than anticipated. IndiGo, India’s largest airline, has received a regulatory nod to wet-lease 11 Airbus A320neo for three months. SpiceJet also has plans to revive 10 grounded aircraft and is likely to induct another 10 aircraft on a wet lease.
Under a wet-lease arrangement, an airline gets aircraft along with crew.
An IndiGo spokesperson said the December quarter always sees a demand surge as Indians celebrate Durga Puja and Diwali, visit friends and relatives, return to home towns and travel during the peak wedding season. It also coincides with lengthy Christmas and New Year holidays in many parts of the world.
“Interestingly, in today’s times, we also see a new travel trend emerging. While traditionally, some people prefer to stay home during these festivities, there are now others who prefer to fly to beaches and mountains. In my view, this indicates a change in people’s travel patterns compared to prior times,” the spokesperson added.
Ratings agency Icra has estimated India’s domestic air passenger traffic to grow 8-13% to touch 150-155 million in FY24, surpassing the pre-covid levels of 141.2 million in FY20. Icra further expects the pricing power of airlines to continue, but cautioned against the impact of elevated aviation turbine fuel prices and volatility in foreign exchange on the cost structure of Indian airlines.
Catch all the Business News , Corporate news , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
MoreLess
First Published:3 Oct 2023, 11:41 PM IST
- Top Gainers
- Top Losers
- 52 Week High