Akasa blames the pilots, but is there more to the rough ride?

In its latest statement to Moneycontrol sent on September 21, the airline reiterated that "when a small set of pilots abandoned their duties and left without serving their mandatory contractual notice period, it forced disruption of flights between July and September, leading to last-minute cancellations that stranded customers and caused inconvenience to the traveling public."

Is there more to it?

Industry experts and insiders suggest that there may be more to Akasa Air's troubles than just pilot resignations.

Captain Shakti Lumba, a retired industry veteran, pointed out that the sudden exodus of pilots alone is unlikely to be the primary reason for reducing flights. Airlines typically hire pilots well in advance of their requirements.

"An exodus of pilots cannot be the only reason why an airline decides to reduce flights, usually airlines hire pilots well ahead of requirement," Lumba said.

Another industry executive noted that airlines typically reduce flights only if around 20 percent of their employees leave simultaneously.

According to interviews with current and former pilots and company executives, pilot resignations may have been the final straw in a series of challenges the airline has faced.

Akasa Air itself in a statement to Moneycontrol on September 21 said, "As of today, we have enough pilots at various phases of their training to fly over 30 aircraft."

"Akasa Air is helmed by a highly experienced, accomplished, and diverse management team. We are a team of planners who are prepared for unforeseen circumstances and have contingency management strategies in place. In that regard, we have a ten-year plan that covers pilot recruitment, training, and career upgrades. As of today, we have enough pilots at various phases of their training to fly over 30 aircraft," the company's statement said.

Rough Weather after The Takeoff

Akasa Air had a promising start, launching its first commercial flight in August 2022 and rapidly expanding its fleet to 19 aircraft by March 2023. The company's top management had expressed optimism about its ability to meet its growing needs for pilots and cabin crew.

However, the airline's plans were disrupted by supply chain issues and increased competition for aircraft deliveries in 2023. Chinese airlines, which had initially slowed down aircraft deliveries due to Covid-19, were now back in the market, creating competition for aircraft resources.

"Indian airlines had moved quickly to capitalise on the ban on Boeing 737 aircraft deliveries to China and a slowdown in engine deliveries to Chinese airlines due to the slow recovery of the Chinese aviation market after Covid-19," a senior official from a leasing major told Moneycontrol.

Dave Calhoun, the Chief Executive Officer of Boeing, said in an earnings call in July 2023, that Boeing has 85 undelivered 737 Max jets designated for China in storage, and has found buyers for another 55 that were originally built for Chinese customers. But by August, Boeing was preparing to restart delivery of 737 Max jets to China after four years, according to Bloomberg.

Supply chain issues and the resumption of deliveries to Chinese airlines hit Akasa Air’s plans to add eight more planes to its fleet and have a fleet of 28 aircraft by March 2024.

The company faced delays in adding its 20th aircraft, VT-YAV, which was added finally on July 30, 2023. It has not added any aircraft to its fleet since then. The company had plans to have a fleet of 28 aircraft by March 2024, it still has only 20 now.

Delays and more

Even as Akasa was grappling with a slowdown in deliveries, it had to ground part of its existing fleet to retrofit them with new seats.

Akasa Air sent 11 aircraft for rejigging its seat arrangement as they were not in line with the airline's original plans. Each of these aircraft had to remove 12 spacious seats, which are sold for a premium price, to replace them with regular economy seats. This would take months.

According to industry sources, since the start of August, Akasa Air sent two planes at a time for seat reconfiguration. This caused flight cancellations and disruption.

As of September 20, 2023, Akasa Air had one plane grounded. Typically, as per industry standards, airlines in India use one aircraft to operate on six sectors (flights) per day. So for every two planes grounded in a month, there would be a reduction of 12 flights per day or 360 flights per month. Grounding of four aircraft would lead to a reduction of 24 flights per day or 720 flights per month.

The airline's aggressive pilot hiring, with close to 300 pilots brought on board between August 2022 and March 2023, led to an excess of pilots compared to the number of flights.

As per industry standards, airlines in India need to have a minimum of 12 pilots to operate this aircraft as per Flight Duty Time Limitations rules set by the Directorate General of Civil Aviation.

With 20 aircraft as of August 2023, the airline needed a minimum of 250 pilots to operate its fleet but had close to 330 pilots. This surplus of pilots resulted in lower flying hours per pilot, impacting their pay and promotion prospects.

"Pilots at Akasa Air have been flying 45-55 hours on an average per month," a pilot currently working with the airline told Moneycontrol.

He added that while lower flying hours bode well for senior pilots, for entry-level pilots on 70-hour-per-month contracts, it means a significant pay cut and delay in completing their minimum hour requirement, needed for promotions.

"Younger pilots have complained about lower flying hours for the last few months. The management has tried to reassure pilots to be patient and wait for new deliveries, but this is at a time when other airlines are aggressively hiring," a second pilot currently working with the airline said.

Similarly, a pilot who recently left Akasa Air for a competitor told Moneycontrol, that pilots had discussed reduced notice periods with the airline and in some cases even received recommendation letters before joining new airlines. “The discussions with HR were never on foul terms," the pilot said.

While the departure of around 40 pilots has certainly affected the airline's operations, it appears that Akasa Air may need to re-evaluate its strategy and planning to ensure a smoother flight path in the future.

The challenges extend beyond the pilot exodus and are related to fleet expansion, supply chain issues, and seat reconfigurations. Addressing these issues will be crucial for the airline's long-term success, industry players said.