The Directorate General of Civil Aviation (DGCA) declared the summary for domestic traffic in India for the month of November. One crore sixteen lakh domestic passengers took to the air in November, which is 2.3% more than the previous month and 11% more than November 2021. The numbers are just 9.8% short of November 2019 (pre-COVID), indicating a healthy return of traffic.
Air India has not been able to push Vistara out to take the number two slot. Vistara not only retained the number two slot but has been closing in on SpiceJet in terms of load factor with 91.7% load factor as compared to 92% of SpiceJet. In 2015, I had written how the highest cost for any airline is the cost of an empty seat. Vistara seems to be pushing for load factor and total revenue over yields at the moment. There was a fair bit of routes being sold at high fares, with those to Port Blair topping the list across airlines.
Full Service carriers had 18.4% market share while the rest 81.6% was with LCCs.
Shake up in OTP
November was the first full month of the winter schedule, which kicked off on October 30th. IndiGo made a lot of negative news in October for slipping on the On Time Performance charts. The airline is back at the top with 92.5% of its flights at the top four metros being on-time. Air India was next at 88.2%, while Vistara followed at 85.6%. Go FIRST had lowest OTP with just 35.9% of its flights adhering to approved schedule.
The three TATA airlines which have been pushing its OTP up over the last few months will have to look at optimising their rotations, ground time and block times in winter schedule immediately if they have to maintain an edge. A look at flight tracking websites shows that IndiGo has rejigged its rotations and increased ground time to come up with better OTP. With its size of nearly 300 aircraft, it was not possible for me to look at the impact this had on the utilization for the airline.
Load Factor and Market Share
For many years now, the question around market share has been about who is second – which has been a revolving position and if any airline can cross 10% market share. Vistara continued with the second spot but could not breach the 10% mark. Vistara cornered 9.3% market share, while Air India had 9.1%. AirAsia India continued with its third spot at 7.6%, while SpiceJet and Go FIRST were tied at 7.5%, with SpiceJet carrying more passengers than Go FIRST. Every airline except Alliance Air and flybig carried more passengers in November, over October.
The market share of Tata group airlines stood at 26%, while IndiGo lead with 55.7%. In terms of number of passengers, IndiGo saw November being its best ever month when it carried 64.4 thousand passengers.
Most airlines have been recording high load factors, primarily due to lack of capacity. The real question though is profitability. The cost of operation has gone down, but have the costs gone down to an extent that it could get the airlines back in profit? A look at random fares, load factors and capacity deployment makes me believe that IndiGo would definitely record an operating profit but the foreign exchange losses could drag the overall profitability again.
Outlook
December has been phenomenal so far, with sixteen of eighteen days recording upwards of 4 lakh passengers per day. Things will only get better from here on as the much dreaded congestion issue is being sorted out. It should be a matter of time before traffic is back at pre-COVID levels, with the usual caveat that we are not hit by another wave of the pandemic.
NetworkThoughts 