Two years of Akasa Air: Where does the airline stand?

Mumbai was once the headquarters of aviation in India. Air India, Jet Airways, and Kingfisher Airlines - all had a swanky presence in Mumbai. Today, Akasa Air is the only one left in Mumbai. It completes two years of operations today, amidst the pandemic and delivery challenges from Boeing,

In May, Akasa Air overtook SpiceJet in domestic market share for the second time. The first time it happened was in June 2023, only to see a reversal two months down the line. A month after its first anniversary, it was hit by pilot issues leading to cancellations. Things compounded further because of the court case which the airline filed against the pilots. The news was silently buried as it faced backlash and the management has since said that it has enough and more pilots to cater to its needs. Things looked set for soaring for the airline with the airline even saying it would soon occupy the number two spot in Bengaluru, only to lose its spots from there on, as it focused on slots in Mumbai to expand its operations.

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Akasa Air of today in terms of network is widely different from Akasa Air of June 2023, when it surpassed SpiceJet. Interestingly, some of its first routes like Mumbai-Chennai, Bengaluru-Chennai, Chennai-Kochi and Bengaluru-Kochi are either not operational any more or have a token presence. On the other hand, it has invested more and more into newer places like Pune, Goa or Mumbai.

Data obtained from Cirium - an aviation analytics company - exclusively for this article shows that Akasa Air has a wider presence in both Mumbai and Delhi today than what it was in June 2023, when it overtook SpiceJet. Mumbai is now 22 per cent of its operations as compared to 18 per cent in June 2023. Delhi has seen a big jump from 5 per cent to 11 per cent. While it harped on Tier II cities being its focus areas, Ahmedabad, Guwahati and Goa have lost out in this expansion with operations being smaller now than what they were in June 2023.

IndiGo the benchmark?

Every time an airline starts in India, the benchmark remains IndiGo for the success that it has had. Akasa Air was the fastest private airline to fly internationally in the history of Indian aviation since privatisation, when it launched flights to Doha, about 600 days from starting operations, making the most of the ‘0/20’ rule.

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The market was vastly different in 2006 when IndiGo started, versus what it is now. However, Akasa Air has 130+ daily flights across 24 destinations in two years; while IndiGo had less than 100 flights to 17 destinations when it completed two years in August 2008. The market has more than doubled since then and that means the 24 planes of Akasa Air may be a record in itself, but are a small portion of what was the case back in 2008. IndiGo had a market share of 10.3 per cent in August 2008. In June, Akasa Air’s market share was 4.8 per cent. July data is awaited.

Luck in favour?

Within a week of the flag-off, the death of Rakesh Jhunjhunwala - Akasa Air’s lead investor - led to a blow to the airline. However, it did not have any impact on day-to-day operations. This unlucky start later, there have been two big factors which have helped the airline. The stunting of SpiceJet, which has not been able to grow due to one problem after another, and the demise of Go FIRST, which helped create capacity in Mumbai and gave the much-needed expansion for the airline at its home airport. Had it not been for Go FIRST, any meaningful expansion from Mumbai would have been possible only after the inauguration of Navi Mumbai airport.

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The changing landscape in Indian aviation, with IndiGo embracing a new class, would well mean that Akasa Air becomes the only low-cost carrier (LCC) in Indian skies with a single class of service and a single type of aircraft. With the international sectors starting, the airline has slowly inched up its aircraft utilisation to over twelve and a half hours.

What next?

Change has been the only constant for Akasa Air in the last two years, but are as many changes good? It will probably reflect only in the finances when they are public. An order which was promised before the end of 2023 came in 2024. Its fleet plan at the mercy of Boeing’s quality issues makes it stay away from any further guidance on expansion after talking about it vehemently in the past. Sample this: the airline announced Jeddah as its second destination and ended up adding two more before Jeddah, making it the fourth destination. There is quite a slip between the cup and the lip, which it possibly needs to get in order for the next year and more.

The airline has not had any new plane in its fleet in this financial year. While it may not chase market share, the rate at which inductions are planned by Tata group and IndiGo, the airline will have to buckle up to push itself for a big break.