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Home / News / India /  Domestic air traffic surges as curbs ease, fares fall

Domestic air passenger traffic rose steeply for the second consecutive week, as a fall in covid-19 cases, lower fares, and the easing of curbs by most states encouraged more people to take to the skies.

Average number of daily fliers rose to 227,000 in the week ended 7 August from 165,000 a week before, broking firm ICICI Securities said in a report on Monday.

The average number of departures rose to 1,937 during the week from 1,730 in the previous week, while the number of fliers per departure rose to 117 from 90 a week ago.

“The reason could be attributed largely to lower fares driven stimulation. However, it is likely to be tactical as government restores the fare caps and floors and capacity quotas to protect weaker airlines. The advance tickets are also being sold through flash sales as announced by Indigo, SpiceJet, Air Asia, and Vistara as forward sales are an important liquidity source for airlines," the report said.

“This indicates that while there is likely to be a strong demand for travel to return to normalcy, it is also likely to be accompanied with aggressive pricing which will be an overhang on margins. As such, profitable operations may remain elusive unless there is a sharp cut in supply. News of a new airline dims the chance of supply cut," the report added.

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