Air traffic continues its slow but steady rise. So, where’s everyone flying?

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Friday the 13th brought some good news for Indian aviation. The daily departure count crossed 60 percent of pre-Covid levels for the first time. Passenger numbers, at 225,097, were the highest since May 25, when airlines were allowed to re-start operations. Subsequently, Diwali week pushed the numbers higher.

October also brought in some cheer with 31 percent growth over September. November is already looking better, thanks to the movement of people due to festivities.

While airlines have been allowed to operate 70 percent of pre-Covid flights now — a long way from 33 percent, when it began — the real questions are over where the traffic is moving and who is on those flights. An exclusive analysis shared by ICF, a global consulting and digital services company, shows that traffic has nosedived between Tier I to Tier I routes.

The two Tata airlines were at the forefront in deploying capacity, with AirAsia India deploying 63 percent of last October and Vistara deploying 58 percent. Market leader IndiGo deployed 55 percent of capacity. While the government has capped capacity at 60 percent for October, it was at pre-Covid levels and a few airlines have grown since last October, which makes their capacity look more than 60 percent compared to last October.

Where is the traffic moving?

There were 63 new routes this October compared with the same month the previous year, with 20 of them being between Tier I and II and 25 between Tier II and Tier II, according to the analysis by ICF. Air India is the only carrier that has increased flights between Tier I to Tier I while both IndiGo and Vistara have dropped such sectors by 9 percent.

The trend is in continuation of previous months, with September seeing a drop of 63 percent over last September for flights between Tier I cities and the drop being lowest for flights between Tier I and Tier II.

The ICF analysis was based on published schedules in SRS Analyzer (an airline data analytics tool) and actual flights as reported by real-time flight tracker flightradar24.com.

This comes as a surprise since the Mumbai-Delhi and Bengaluru traffic was reaching new highs with each passing month in the past with Mumbai–Delhi also making it to the top 10 routes worldwide in the past.

Why the shift?

The last few months since the lockdown have seen a lot of movement of migrant workers. While there were special trains run on some occasions, corporates have started paying for air tickets in some cases, due to the lack of trains and relatively higher safety with air travel to get workers back to cities as economic activity restarts.

Uttar Pradesh, Bihar and Jharkhand have traditionally contributed to the industrial workforce across India and there was unidirectional traffic when air services began. Both September and October have seen load factors rallying to around 70 percent, a far cry from the near 90 percent load factors of the past. The cap on fares has meant that flying is more affordable for people and as economic activity picks up, industries are willing to pay to have their trained labour return at the earliest.

This is evident from the fact that Patna saw the highest recovery, with over 80 percent of pre-Covid flight movements. The airport also saw the maximum number of new connections and flights, with airlines operating routes that were hitherto not part of their schedule. The case is similar with Gorakhpur and Varanasi. Another thing in favour of Patna was the elections; traditionally, air traffic has seen a considerable spike in India during elections.

What next?

The Indian government has allowed an increase in capacity with a cap of 70 percent. While the passenger numbers are still low, a gradual increase, positive news on the vaccine front and increased trade and economic activity in the country have meant that there is business traffic again, led by MSMEs, individual traders and VFR (Visiting Friends and Relatives) traffic.

The primary driver of air traffic in India used to be people travelling for meetings. But with in-person meetings still not encouraged, it will take time for Tier I metro routes to get back into action. For the airlines, as long as the fare caps are in place, this will not bode well, since the premium traffic comes from the metro routes, which are the worst affected right now.

Ameya Joshi runs the aviation analysis website Network Thoughts.