Seat occupancy up on domestic flights but concerns remain

New Delhi: Indian carriers are enjoying increasing occupancy on domestic routes compared with two years ago.
Analysts, however, warned that a sudden increase in capacity, hike in jet fuel price or a new service tax on domestic travel could offset the gain.
Domestic flights across airlines were 72-85.2% full in February, according to data released by the regulator Directorate General of Civil Aviation (DGCA) on Monday.
In contrast, occupancy rates for the same month in 2008 ranged between 58.3% and 75.9%, and between 66.3% and 82% in February 2009, when the country was in the middle of an economic slowdown.
National flag carrier Air India, which accounted for the lowest occupancy rate in February 2008, saw 72% occupancy in February.
“If capacity is constant and airlines are not adding too many seats, the existing flights will become full, which is what we are seeing,” said Samyukth Sridharan, chief commercial officer of India’s second largest low-cost carrier SpiceJet.
There were 5.50 million seats on offer in February 2008 on domestic routes by all airlines put together, which shrank to 4.87 million in February 2009 and rose to 5.30 million in February. The cuts were caused by a need to rationalize capacity due to the economic slowdown and rising fuel prices.
Sridharan said the number of passengers had also increased since 2008.
The DGCA data shows nearly 3.86 million passengers took to the skies in February, compared with 3.58 million a year ago.
15/03/10 Tarun Shukla/Live Mint

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Categories: Indian Aviation- In General Mar 2010