Indian aviation will fly out of pandemic-induced fare bands in September with some of its heaviest losses behind it. Indian fliers have also been through a bout of technical glitches that the authorities have traced back to aircraft not having enough certifying manpower and flying with the minimum permissible list of defective equipment. A strong festive demand could reverse the sequential declines in air travel during the ongoing lean season. The removal of airfare caps coincides with a recent softening of jet fuel prices that, however, remain elevated. Freedom to pass on the biggest cost component to fliers should improve the financial metrics of airlines. One is keeping one's fingers crossed and seat belts buckled.
The industry is witnessing a round of capital infusion that also affects the competitive intensity. The Tatas are consolidating the splintered market share of the group's various airlines, and SpiceJet is considering a stake sale to raise funds. Market leader IndiGo expects its strong revenue performance will lead it back into profits soon. Although the industry's air traffic yields have surpassed pre-pandemic levels, fuel costs and a declining rupee could subdue earnings. Newly opened up foreign routes are likely to witness stiff competition. The launch of Akasa Air and resumption of operations by Jet Airways will increase demand for airline employees. Air India is restoring salaries to pre-Covid levels.
Industry-wide losses are expected to fall sharply this year as Indian aviation enters another phase of growth. India is among the fastest-growing aviation markets in the world and has a lot of catching up to do in terms of the size of its commercial aircraft fleet. Given the country's traffic growth projections, Indian airlines are likely to acquire more clout as aircraft buyers. The government, on its part, has a big budget for decongesting airports and is encouraging the development of the domestic aircraft maintenance industry. As India's airlines fly out of the current cloud bank, sunny skies await.
The industry is witnessing a round of capital infusion that also affects the competitive intensity. The Tatas are consolidating the splintered market share of the group's various airlines, and SpiceJet is considering a stake sale to raise funds. Market leader IndiGo expects its strong revenue performance will lead it back into profits soon. Although the industry's air traffic yields have surpassed pre-pandemic levels, fuel costs and a declining rupee could subdue earnings. Newly opened up foreign routes are likely to witness stiff competition. The launch of Akasa Air and resumption of operations by Jet Airways will increase demand for airline employees. Air India is restoring salaries to pre-Covid levels.
Industry-wide losses are expected to fall sharply this year as Indian aviation enters another phase of growth. India is among the fastest-growing aviation markets in the world and has a lot of catching up to do in terms of the size of its commercial aircraft fleet. Given the country's traffic growth projections, Indian airlines are likely to acquire more clout as aircraft buyers. The government, on its part, has a big budget for decongesting airports and is encouraging the development of the domestic aircraft maintenance industry. As India's airlines fly out of the current cloud bank, sunny skies await.
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