Sunday, November 21, 2021

India's airlines still face significant headwinds

The number of domestic air travellers has been rapidly increasing. Most recent figures show that domestic travel is inching towards 70 percent of pre-Covid levels. Packed airport terminals and rising occupancy on flights are proof of the same. Add to this the recent 72 aircraft order by the startup airline Akasa, the successful sale of the national airline Air India to the Tata group, a settlement between Boeing and SpiceJet, the possible revival of Jet Airways, buzz about additional aircraft orders by incumbents and another startup waiting in the wings. Together these are adding up to much enthusiasm. Yet, behind the narrative also lies the fact that yields are being held up by government-mandated price-floors, international flying continues to be depressed, airlines are carrying excess fleet and fixed costs, currency fluctuations continue, fuel prices have doubled in the past year and airport charges continue to rise unabated. Overall, Indian aviation is not quite out of the woods yet. See what the headwinds ahead are >>

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