Volcanic ash: Domestic airlines lose Rs 82 cr, stocks tumble

New Delhi/Mumbai: The volcanic eruption that has turned the European airspace into a virtual no-fly-zone is estimated to have cost domestic airlines nearly Rs 82 crore in terms of passenger revenue in the past few days as the disaster kept flights grounded.
Aviation stocks on BSE mirrored the financial damage with Jet Airways, Kingfisher Airlines and SpiceJet falling to Rs 502.40 (6.47%), Rs 48.25 (2.82%) and Rs 56.25 (4.17%), respectively on Monday. National carrier, Air India operates nearly 30 flights to various European destinations such as Frankfurt, Paris and London.
As per an industry estimate, a long-haul flight to London generates a revenue of Rs 1 crore daily with US-bound flight bringing in Rs 1.5 crore. “Globally, airlines are losing $200 million a day due to the closure of European airspace. Indian carriers’ share to the total loss is about 5-7%,” Amadeus India managing director Ankur Bhatia said. Indian carriers operate about 30% of their international flights to European and American destinations.
The latest crisis has hit the carriers at a time when the industry is struggling to come out of the red caused by spiralling fuel price and recession.
Airlines are also losing passengers on their domestic network as in-bound air travellers from Europe are stranded and not coming to India. Air India and Jet Airways, which operate services to North America, have re-routed their flights through Egypt and Greece.
As per the Directorate General of Civil Aviation (DGCA), over 41,000 passengers have been affected at Delhi and Mumbai airports due to cancellation of flights.
20/04/10 Economic Times

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Categories: Indian Aviation- In General Apr 2010