Wednesday, March 18, 2020

IndiGo, Vistara May Ground Jets as Virus Cases Jump in India

Two of India’s most high-profile airlines are considering grounding planes as the coronavirus ravages travel demand, people familiar with the matter said. IndiGo, Asia’s biggest budget airline by market value, has seen traffic slump as much as 30% in India, while its international flights have dried up following government restrictions on travel, one of the people said, asking not to be identified because the deliberations aren’t public. In addition to potential groundings, Vistara, the Indian venture of Singapore Airlines Ltd., is considering delaying delivery of some of the first batch of Boeing Co. 787 Dreamliners it has on order, another person said.
Should the pair go ahead with the flight cancellations, they’d join the growing number of airlines around the world doing so — United Airlines Holdings Inc. and British Airways’s parent recently announced capacity cuts — as the pandemic keeps people from flying. Indian carriers have avoided major reductions in flights so far but pressure is mounting as the number of confirmed cases climbs in the world’s second-most populous country. Industry groups and analysts have issued dire warnings about the virus, with Sydney-based CAPA Centre for Aviation saying that most of the world’s airlines could go bankrupt by the end of May unless authorities step in. The International Air Transport Association said Tuesday that the global airline industry needs as much as $200 billion in government aid and bailout measures to survive the crisis.
With demand expected to fall at least 40-50% in the near term, India’s airlines may initially ground 150 aircraft, the local unit of CAPA said Wednesday. Even after a slump oil prices, the country’s airlines will lose $500-$600 million this quarter, excluding loss-making national carrier Air India Ltd., and that estimate may be revised downward.
18/03/20 Anurag Kotoky/Bloomberg|Quint
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