Country’s aviation regulator, Directorate General Civil Aviation (DGCA), in its monthly statement, revealed that the domestic air passenger traffic registered an annual growth of 32.92 per cent during January – June 2023 period compared to the corresponding period of the previous year after Indian domestic airlines carried 7.60 crore passengers during the first half of 2023.
The monthly passenger growth was also 18.78 per cent during June, underscoring the sustained momentum of the domestic airline industry.
As per the data from the DGCA, IndiGo and Akasa Air’s market share increased to 60.7 per cent and 4.6 per cent in June, respectively. Whereas SpiceJet and grounded-Go First’s market share declined to 5.2 per cent and 2.3 per cent, respectively.
Airlines owned by the Tata Group (Air India + Vistara + Air Asia India) market share remained at 25.7 per cent after June 2023.
According to the Airports Council International (ACI Asia-Pacific), India has recorded the highest surge in airfares among other countries in the Asia Pacific and Middle East regions. The rise in airfares in India, which stands at 41 per cent, has raised concerns about the long-term recovery of the civil aviation industry.
Commenting on the Indian aviation industry’s monthly domestic passenger traffic, ratings agency ICRA said, the airlines’ capacity deployment in June 2023 was higher by one per cent than that of June 2022, but it was lower by 4.8 per cen in comparison to the pre-Covid levels (June 2019). It is estimated that the domestic aviation industry operated at a passenger load factor (PLF) of 93 per cent in June 2023, against 79 per cent in June 2022 and 89 per cent in June 2019 (pre-Covid levels). Suprio Banerjee, Vice President & Sector Head – Corporate Ratings, ICRA Limited said, “Despite a healthy recovery in passenger traffic, the domestic aviation industry continues to face challenges on account of elevated ATF prices and depreciation of the INR vis-à-vis the USD compared to the pre-Covid era, both of which have a major bearing on the airlines’ cost structure. However, ATF prices have declined sequentially over the past five months until June 2023. In July 2023, the prices witnessed a marginal sequential increase of 2 per cent. However, on a Y-o-Y basis, it remained lower by 34 per cent over July 2022—nevertheless, the same remains at elevated levels when compared to the pre-Covid era. The airlines’ efforts to ensure fare hikes proportionate to their input cost increases will be key to expanding their profitability margins.”
