Players in the non-scheduled operators (NSOP) sector offering chartered flights have started feeling the effects of the economic slowdown, with the
number of companies dropping from 163 last year to 99 in 2019, amid worries over escalating operational costs and fall in demand.
Faced with a drop in demand the operators have either shut shop, reduced the number of flights or moved into other territory. From a mere 134 in 2001, the number of aircraft, including helicopters, turboprops and business jets, in the sector rose to 514 in 2016, when India was still growing at a healthy rate.
However, things then took a downward swing and the total fleet came down to 447 in 2018. The industry had a turnover of $609.3 million in 2016; in 2018 that dropped to $582.3 million. “Every industry is talking of cost-cutting. In such a scenario who will hire choppers and private jets,” said the spokesperson of an NSOP operating from Mumbai.
Clients hiring helicopters and private jets come from a variety of industries, ranging from real estate and healthcare (for helicopter ambulance services) to power and tourism. Then there are top movie stars and politicians who charter services – priced from Rs 20,000 to Rs 1 lakh per hour depending on the type of aircraft. High taxes on aviation fuel, steep airport charges, and paucity of hangars and parking slots made it difficult for operators to continue.
As the other sectors began to reel under the crisis, chartered flight operators saw their problems mounting. “Aviation fuel is charged in dollars and the rupee has been in freefall for over a year now. Then there is the 18 per cent Goods and Service Tax. With demand shrinking, cost liability is turning out to be huge,” the spokesperson added. Vinit Phatak, managing director of Invision Air, said most operators were not getting adequate utilisation per month to keep fleets running.
“A charter operator should get at least 50 to 60 hours of utilisation per month, but they are getting barely 20-30 hours. This is not enough to recover even the basic cost,” said Phatak.
Invision Air started in 2010 as an aircraft operator before tying up with a Canada-based company to facilitate buying and selling of aircraft. In aviation terminology, utilisation is the average number of hours during a 24-hour period that an aircraft is actually in-flight. Most of the companies that have shut operations were unavailable for comment, including Air Costa, which had to close shop in 2017 after four years in the business.
14/10/19 Shruti Ganapatye/Mumbai Mirror
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Faced with a drop in demand the operators have either shut shop, reduced the number of flights or moved into other territory. From a mere 134 in 2001, the number of aircraft, including helicopters, turboprops and business jets, in the sector rose to 514 in 2016, when India was still growing at a healthy rate.
However, things then took a downward swing and the total fleet came down to 447 in 2018. The industry had a turnover of $609.3 million in 2016; in 2018 that dropped to $582.3 million. “Every industry is talking of cost-cutting. In such a scenario who will hire choppers and private jets,” said the spokesperson of an NSOP operating from Mumbai.
Clients hiring helicopters and private jets come from a variety of industries, ranging from real estate and healthcare (for helicopter ambulance services) to power and tourism. Then there are top movie stars and politicians who charter services – priced from Rs 20,000 to Rs 1 lakh per hour depending on the type of aircraft. High taxes on aviation fuel, steep airport charges, and paucity of hangars and parking slots made it difficult for operators to continue.
As the other sectors began to reel under the crisis, chartered flight operators saw their problems mounting. “Aviation fuel is charged in dollars and the rupee has been in freefall for over a year now. Then there is the 18 per cent Goods and Service Tax. With demand shrinking, cost liability is turning out to be huge,” the spokesperson added. Vinit Phatak, managing director of Invision Air, said most operators were not getting adequate utilisation per month to keep fleets running.
“A charter operator should get at least 50 to 60 hours of utilisation per month, but they are getting barely 20-30 hours. This is not enough to recover even the basic cost,” said Phatak.
Invision Air started in 2010 as an aircraft operator before tying up with a Canada-based company to facilitate buying and selling of aircraft. In aviation terminology, utilisation is the average number of hours during a 24-hour period that an aircraft is actually in-flight. Most of the companies that have shut operations were unavailable for comment, including Air Costa, which had to close shop in 2017 after four years in the business.
14/10/19 Shruti Ganapatye/Mumbai Mirror
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