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Demand for charter flights soars as the rich look to travel exclusive in COVID-19 times

Charter service providers say inquiries have increased by up to 25 percent, from the pre-COVID-19 times

June 05, 2020 / 02:22 PM IST
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Todays L/H

Imagine four passengers in a flight that can otherwise seat 180.

That's what happened in May, just after domestic flights resumed, when a Bhopal-based businessman chose to charter an IndiGo aircraft to fly his daughter, two grandchildren and their maid, to Delhi. Fare for the one hour, twenty minute flight? About Rs 10 lakh.

It may be a rare occurrence, but may now become more regular as the rich and the affluent look to travel as exclusively as possible to ensure hygiene, social distancing, and to keep COVID-19 at bay.

And that's why charter service providers - even though they may have lost some business from the Bhopal entrepreneur  - sound more optimistic about the present economic circumstances than their counterparts in the commercial aviation.

"There is a lot of pent up demand, which is all for essential flying. People have been stuck in India, or overseas and want to get back," said Rohit Kapur, President, Jet HQ Asia, which advises customers in aircraft acquisition.


Industry players have been ferrying stuck Indians, most from London, the Middle-East and South-East Asia, including from Singapore and Vietnam. "These are HNIs who don't want to take the repatriation flights that Air India is operating," added Kapur.

Businessmen have also begun traveling, eager to check on their factories and meet employees after being grounded since March, when the lockdown was announced.

"We have seen a 15 percent surge in calls for domestic flights," says Rajan Mehra, CEO, Club One Air, a charter provider with a fleet of 10 aircraft.

"Even more surprising is the demand for international travel and this has gone up 25 percent," adds the former India head of Qatar Airways.

The international inquiry, included one for holidaying in Maldives.

The increasing demand has seen some of the operator even increasing the hourly rates. For instance Atom Aviation Services, a Delhi-based company, has increased its hourly rates from Rs 75,000 an hour to up to Rs 1 lakh an hour. "Earlier we used to get about six or seven inquiries. Now this has increased to 10 to 12 a day," says Archit Gupta, founder of Atom.

The increase is in stark contrast to the subdued demand that commercial airlines, including IndiGo, SpiceJet and GoAir are seeing for their flights. Industry executives point out that occupancy levels are less than 50 percent.

The big guys

That is probably the reason why IndiGo and SpiceJet have formally started charter services. Both have been operating truncated schedules, and much of their fleet is grounded, lying unused.

"This is especially so for their smaller aircraft that used to earlier fly the UDAN routes. These are the ATRs planes for IndiGo and Bombardier Q400s that SpiceJet has.Now these can be used for charter services," said an industry executive.

SpiceJet, which started off first, has been aggressive. It has already operated flights from the Middle-East, bringing back a group of Indians, who wanted to avoid commercial flights. It has also ferried seafarers from India to Doha.

The push from the bigger airlines hasn't necessary made charter providers worried. "People prefer a SpiceJet or an IndiGo only when its bulk booking, of mostly over 100 passengers. We can hardly have more than 20 passengers in our flight," says a senior official.

Surely, the Bhopal flight was an aberration.

The shift

Despite the disruption caused by COVID-19, industry executives point out at the silver lining.

"The calls we get are mostly from our repeat customers. At the same time, we see inquiry from those who are exploring chartered flights for the first time. These are customers who earlier may have been flying first class or business class with commercial airlines, but are now shifting to ensure safety," says Mehra.

Interest has been so high that Blade India, the local unit of Fly Blade -- the largest arranger of helicopter flights for civilian travel in the US, is looking forward to restart its services at the earliest.

"Even those among the rich who used to prefer driving down from Pune to Mumbai, now want to fly as they want to limit time on the road,' says Amit Dutta, Managing Director, Blade India.

The company operates in the Pune-Mumbai-Shirdhi route. But it hasn't started operations yet as its base in Pune lies in red zone and the movement is restricted.

The SoP soup

Despite the promising resumption to business, industry players also underline the challenges, especially if all the queries have to translate into bookings.

"Much of the business travel may remain restricted for a few months more. Many top executives now prefer video conference. Zoom and Webex - the video conferencing apps -  are the new private jets!" says Kanika Tekriwal, CEO, JetSetGo.

Customers are also wary about the confusing quarantine regulations at several states. "A quarantine of seven to 14 days makes travel meaningless," adds an industry executive.
Prince Mathews Thomas heads the corporate bureau of Moneycontrol. He has been covering the business world for 16 years, having worked in The Hindu Business Line, Forbes India, Dow Jones Newswires, The Economic Times, Business Standard and The Week. A Chevening scholar, Prince has also authored The Consolidators, a book on second generation entrepreneurs.
first published: Jun 5, 2020 02:22 pm

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