Rising fuel costs, induction of more planes, competition and demonetisation played havoc with the financials of carriers in the last quarter of 2016. In fact, while the airlines under review – IndiGo, SpiceJet and Jet Airways – faced problems, all of them look forward to growth with profits in 2017.
An airpocket for IndiGo
The quarter that ended on December 31, 2016 was, perhaps, the first one that saw IndiGo faltering. Hit by a number of factors —high fuel costs, low yields, competition and the government's demonetisation move — the earnings of ₹487.3 crores were not according to analysts’ estimates.
It was the first time that IndiGo’s operational performance went down. Ontime performance — one of the carrier’s strengths and pride — saw a downfall in each month in the quarter (according to DGCA reports that only takes into consideration arrivals and departures from the four private metro airports of Bengaluru, Hyderabad, Mumbai and New Delhi). In October, IndiGo’s OTP was 81 percent; down to 72 percent in November and 62 percent in December. Though this downward trend was partly because of the foggy weather and congestion, it was also due to the nonperformance of the A320NEOs. The carrier parks a large number of its planes in Delhi and Bengaluru and both places experienced foggy conditions.
Though IndiGo adjusted its ticket prices to get the highest load factors (load factor for the quarter was 87 percent on a fleet of 126 aircraft), there was a drop of 25 percent in profit, driven by lower yields and higher costs. Capacity went up by 34 percent and traffic too grew by 38 percent. However, the higher volumes could not counter the low yields: 10 percent in October, 20 percent in November and 17 percent in December. IndiGo’s woes – or for that matter all the LCCs woes – were compounded when Air India and Jet Airways brought in widebodies for domestic routes. Additional capacity from all airlines in winter resulted in yield declines.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
Jets, Tech, And Green Goals
The key themes at the Farnborough International Airshow 2024 revolved around innovation and sustainability. Sizeable aircraft orders, advancements in eVTOL technology, and a strong commitment to environmental goals underscore an industry that is not only rebounding from past challenges but also setting the stage for a more sustainable and technologically advanced future, reports ATUL CHANDRA.
FREIGHT IN FLIGHT
In 2023, Indian airports handled over 3.15 million metric tonnes of cargo, with international freight dominating. As the sector aims to meet the government's ambitious annual target of 10 million metric tonnes (MMT) by 2030, this goal will require dedicated freighter aircraft, technological integration, infrastructure development, and regulatory improvements, among other things. By JAIDEEP MIRCHANDANI, Chairman, Sky One
ELEVATING PASSENGER EXPERIENCES
Panasonic Avionics Corporation is setting new standards in in-flight entertainment and connectivity (IFEC) with the launch of its state-of-the-art software design and development facility in Pune, highlights
CAUGHT IN PAPER JAM
Despite rapid digital advancements in passenger air travel with the airline market expected to surpass $35 billion by end of this decade, the air cargo industry remains bogged down by outdated legacy systems, impeding progress in efficiency and real-time tracking. A special report by
PITCHING FOR SUPPORT
India's air cargo industry is gearing up for a major transformation, aiming to nearly triple its capacity by 2030. Current infrastructure handles about 6.5 million tonnes, but meeting future goals will require significant investments to expand capacity, streamline operations, and adopt cutting-edge technologies. Industry leaders at a recent ACFI Annual Conclave emphasised the need for strong government support to overcome challenges, urging policymakers to address operational constraints and improve connectivity, reports
BATTLE FOR THE SKIES
As India's international air traffic experiences significant growth over the past few decades, the competition between Air India and IndiGo intensifies. Vistara's merger within Air India and the significant aircraft orders position the combined entity as a formidable player, while IndiGo's ambitious expansion plans and international focus set the stage for a competitive future, analyses
"We Aim to Bridge the Training Gap in Indian Aviation"
In a candid conversation with CRUISING HEIGHTS, KHUSHBEG JATTANA, General Manager India of Simaero, discusses the strategic timing of Simaero's entry into the Indian aviation market. He addresses the challenges posed by existing pilot training programmes from major airlines like Air India and IndiGo, and elaborates on Simaero's plans to complement these efforts with state-of-the-art training solutions. Jattana also sheds light on the potential growth in the South Asian region and the company's vision for the future.
POWERING UP
Urban Air Mobility providers are accelerating their eVTOL development programmes, reports
Transforming Air Traffic Control Training: CAE's Cutting-Edge Approach
In this interview, MARIE-CHRISTINE CLOUTIER, CAE's Vice-President of Performance, Strategy, and Marketing, discusses CAE's air traffic control training program. Highlighting strategic partnerships, advanced technologies, and global initiatives, the interview reveals how CAE addresses the growing demand for skilled air traffic controllers and flight service specialists. From their dedicated Montreal facility to expanding efforts across the globe, CAE is committed to providing tailored, state-of-the-art training solutions for the aviation industry's future.
POWERING A GREEN FUTURE
FIA 2024 witnessed a growing order book for aircraft engine manufacturers and provided important insights into the development of sustainable powerplants.
