New Delhi: India’s biggest airline IndiGo has sought lifting of restrictions on the economy and on flying to prevent further job losses in the country, while stating that it will not be able to cover its entire cost unless 85-90% of its capacity is used.
“We are currently operating 28-30% of our (fleet) capacity. We did not expect the demand to be so strong as it has been. There was a feeling that first few days will see some travel and then demand will subside, which did not happen. While aircraft occupancy is not 90%, at this point 20 days after resuming schedule flights, the travel trend keeps going up in terms of unit revenue and future bookings. The deployed capacity should be higher with airports removing their restrictions,” CEO Ronojoy Dutta told TOI.
The airline, which used to operate 1,500 daily flights before the pandemic, hopes to ramp up to 50% of capacity and then keep adding more flights. “In this crisis, there is no point doing long-term planning. We are doing month-to-month planning and growing capacity slowly.” Seeking “course correction” for the lockdown, as the economic impact has hit the most vulnerable sections — 30-40-year olds with financial responsibilities losing jobs — Dutta sought reopening of the economy and the skies.
At the same time, Dutta suggested that the government should lower levies, although he maintained that IndiGo was financially sound and could weather the storm. “There is lot of inefficiency in the Indian aviation system. We have the highest jet fuel prices in the world, due to taxes and then several other taxes. The government should harmonise all of that. There has been talk that this sector will get some bailout. We are holding our breath for that but so far there has been nothing.”
Dutta expects changes in the way people travel. Although flyers are still wary, the former United Airlines head said there could be some shift of passengers from trains to airlines in the coming months as the travel time is lower. “While overall travel will fall, within that there will be a shift. India last year saw 14 crore domestic flyers, while 160 crore travel every year in the first, second classes of trains and on premium trains. Even a slight shift due to lesser travel time makes a shift likely. There’ll be a change in the travel industry’s structure,” Dutta said.
Besides, he said, more passengers will now prefer to travel non-stop between India and rest of the world, without going through a hub to avoid touch points.
16/06/20 Sauabh Sinha & Sidhartha/Times of India
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“We are currently operating 28-30% of our (fleet) capacity. We did not expect the demand to be so strong as it has been. There was a feeling that first few days will see some travel and then demand will subside, which did not happen. While aircraft occupancy is not 90%, at this point 20 days after resuming schedule flights, the travel trend keeps going up in terms of unit revenue and future bookings. The deployed capacity should be higher with airports removing their restrictions,” CEO Ronojoy Dutta told TOI.
The airline, which used to operate 1,500 daily flights before the pandemic, hopes to ramp up to 50% of capacity and then keep adding more flights. “In this crisis, there is no point doing long-term planning. We are doing month-to-month planning and growing capacity slowly.” Seeking “course correction” for the lockdown, as the economic impact has hit the most vulnerable sections — 30-40-year olds with financial responsibilities losing jobs — Dutta sought reopening of the economy and the skies.
At the same time, Dutta suggested that the government should lower levies, although he maintained that IndiGo was financially sound and could weather the storm. “There is lot of inefficiency in the Indian aviation system. We have the highest jet fuel prices in the world, due to taxes and then several other taxes. The government should harmonise all of that. There has been talk that this sector will get some bailout. We are holding our breath for that but so far there has been nothing.”
Dutta expects changes in the way people travel. Although flyers are still wary, the former United Airlines head said there could be some shift of passengers from trains to airlines in the coming months as the travel time is lower. “While overall travel will fall, within that there will be a shift. India last year saw 14 crore domestic flyers, while 160 crore travel every year in the first, second classes of trains and on premium trains. Even a slight shift due to lesser travel time makes a shift likely. There’ll be a change in the travel industry’s structure,” Dutta said.
Besides, he said, more passengers will now prefer to travel non-stop between India and rest of the world, without going through a hub to avoid touch points.
16/06/20 Sauabh Sinha & Sidhartha/Times of India
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