Thursday, June 01, 2023

May was historic for Indian aviation, closing with highest passenger traffic

As the Ministry of Civil Aviation declared its daily passenger data for the last day of May, the total for the month came up to 13.1 million. This not only pips the 12.8 million each in March and April, but also goes past the 13 million mark of December 2019, previously the best month for domestic aviation.

This comes even after Go First stopped operating flights after the first three days of May. The airline carried 829,000 passengers in April for a 6.4 percent market share.

The stage for a bumper month was set after the best-ever day in terms of domestic traffic was recorded on the last day of April. New highs were expected as May is the peak month for travel because of the holidays and the risk of COVID was at an all-time low this year.

Every airline tried to take advantage of Go First’s absence. Air India and Vistara operated widebody aircraft on some routes to cater to additional traffic while IndiGo increased utilisation. Yet, the total count of flights could not match what would have been possible with Go First.

Data released by the Ministry of Civil Aviation on its website shows that airlines in India operated 87,497 domestic flights on a daily basis in May, or an average of 2,822 flights per day, which is 86 percent of the daily flights approved for the summer schedule. Yet, this was lower than April (with fewer days than May), when airlines operated 88,749 flights, and March, when there were 92,098 domestic departures.

While the number of flights has gone down with each passing month, passenger numbers have gone up.

Go First used to ferry 15,000 to 20,000 passengers daily when it ended operations. The number of passengers in India averaged 425,000 daily in May, the same as in February 2020, the last full month of operations before COVID. These are about 3,000 passengers less per day than in April, but that shows that even with fewer flights, the industry was able to absorb almost the full impact of Go First’s absence.

This was largely driven by higher load factors, with all major airlines clocking load factors in excess of 90 percent on most days of the month. The top six airlines are likely to report load factors in excess of 89 percent for the entire month, when the regulator releases granular data later.

Social media has been abuzz with complaints from passengers about higher air fares. As load factors cross 90 percent on most days, the last few seats offered are in the highest fare brackets by airlines, which is a function of revenue management. These are mostly last-minute fares, those to high-demand tourist destinations or on sectors where Go First had a strong network and were immediately affected after the airline halted operations.

01/06/2023 Ameya Joshi/Moneycontrol

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