Akasa Air eyes cost leadership in India, plans to grow fleet by 30 percent every year till 2032

Akasa Air also highlighted that expansion in both the Indian domestic market and international market are key for the airline's growth strategy going forward.

India's newest airline, Akasa Air, is confident in its ability to manage costs and turn profitable in the coming years, with plans to become a cost leader amongst domestic carriers, Chief Financial Officer Ankur Goel said on July 22.

"Based on our projections when starting Akasa Air, our management is very happy with the way we have managed our costs in the last few years while growing as an airline," Goel said as part of a round table discussion on July 22.

Akasa CFO added that while Akasa Air's absolute loss numbers have risen in 2024-25, the airline’s Cost per Available Seat Kilometer (CASK) - a key metric measuring the cost of flying one seat for one kilometer - fell by 7 percent on year in 2024-25 to be lower than the airline's unit revenue (Revenue per Available Seat Kilometer) which rose by 13 percent on year in the same time.

CASK is a crucial indicator of an airline's operational efficiency and financial health, used to compare cost performance with competitors for making strategic decisions on routes, pricing and operations. Revenue per Available Seat Kilometer is a key performance indicator that measures how much revenue an airline generates for each kilometer flown, considering every seat available (whether occupied or not).

Goel said along cost-effectiveness, Akasa Air aims to be the safest airline in the world and has adopted the best practices to ensure the safety of its passengers.

Financial Performance

Goel added that Akasa Air's growth in unit margin was offset by growth of its fleet and employees. As the airline grows in size, its growth in unit margin will outpace the cost growth, making it profitable, the CFO added.

Goel added that Akasa Air registered a revenue growth of 49 percent on year in 2024-25, driven by a 48 percent on year growth of Available Seat Kilometres (or ASKs). He explained that as Akasa Air's ASKs grew in FY25, its overall expenses in absolute number grew to be larger than its revenue, but the pace at which expenses grew was slower than the growth of its revenue, indicating that the airline will soon reach a break-even and move toward profitability.

He added that the 13 percent increase in stage-adjusted Revenue per Available Seat Kilometre (RASK) was due to enhanced focus on key business functions, including distribution capabilities and investment in technology.

The airline’s EBITDAR margins for 2024-25 also improved by 50 percent despite industry-wide inflationary pressures, Goel said.

"An airline with healthy (and ever improving) unit margins but negative net profit may be in a far better position than a profit-making peer with high CASK and weak cost control," Goel said.

According to reports, Akasa Air’s standalone net loss rose 18.7 per cent on-year to roughly Rs 1,983 crore in 2024–25, driven by rising employee costs, aircraft maintenance and airport charges, and a sharp increase in foreign exchange (forex) expenses.

Goel told reporters that Akasa Air is in the process of filing its annual results for 2024-25 and annual report with the Ministry of Corporate Affairs and it will be available soon.

Pilots’ Concerns

Akasa Air's CFO said concerns around pilots’ flying hours will be addressed by the end of 2025-26. By year-end, the airline would be able to able to clock flying hours for its 775 pilots by taking delivery of new aircraft from Boeing.

In December 2024, some Akasa Air pilots approached the civil aviation ministry, alleging mismanagement, favouritism, harassment, and compromised safety standards in the airline’s pilot training and evaluation processes. Akasa Air termed them as "baseless and untrue."

Flying hours are important for pilots as most contracts offered by airlines are based on a hours-per-month payout, which means lower flying hours results in lower takeaway for pilots.

Fleet Addition

Goel added that based on discussion with aircraft manufacturer Boeing, Akasa Air is confident to grow its aircraft fleet 25-30 percent every year till 2032. Akasa Air plans to operate a fleet of 226 aircraft by 2032 as it targets a compound annual growth rate (CAGR) of 25-30 per cent in capacity over the next seven years.

"Currently, Akasa Air has 23 Boeing 737-8 aircraft in our fleet that have a capacity of 189 seats per aircraft, and seven Boeing 737-8/200 aircraft that have a capacity of 200 seats per aircraft," Goel said.

The airline, which began operations in August 2022, expects to add five more planes during the current fiscal year, taking the total fleet size to 35.

"We believe that most of Boeing's issues are behind them. The conversations Akasa Air is having with Boeing indicates that aircraft will be delivered faster than scheduled, not later. We are not worried about delivery delays of aircraft from Boeing. We communicates with Boeing almost everyday," Goel said.

Akasa Air expects to start taking delivery of Boeing 737-10 aircraft, which feature a seating capacity of 227, by 2027, Goel said. The carrier is currently expanding its fleet by adding Boeing 737 Max 8 aircraft with a seating capacity of 197 passengers.

Goel added that in terms of ASKs (Available Seat Kilometers) Akasa Air will grow by 30 percent in FY26 when compared to FY25.

Network Expansion

Akasa Air also highlighted that expansion in both domestic and international market are key for the airline's growth strategy. Goel told reporters that 16 percent of Akasa Air's current operations are used on international routes and by the end of 2025-26, around 25 percent of the airline's revenue will come from international operations.

He added that Indian aviation still has a demand-supply mismatch and opportunity for airlines to grow domestically.

"Indian airline's fleet addition is currently growing at a pace of 6 percent on year while demand is growing by around 15 percent on year, leaving behind a demand-supply mismatch," Goel said, adding that Akasa Air's domestic network will continue to grow for the foreseeable future.

Akasa Air will continue to expand its footprint and capitalise on Navi Mumbai and Noida International Airports to further enhance its operational capabilities and connectivity both within India and internationally.

Goel also said that Akasa Air expanded its ancillary portfolio during FY25 and now offers a slew of over 25+ ancillary products, which generate additional revenue and play a critical role in building a more resilient and diversified business model.

With nearly 1 lakh tonnes of cargo carried by March 2025, Akasa also emerged as a force in India’s cargo landscape, a function that will remain a key pillar of the airline’s revenue strategy.