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Flights resumption: Even as flights and passenger number increase on day 2, low loads a worry for airlines

Civil Aviation Minister Hardeep Singh Puri tweeted on May 26 evening that airports have handled 325 departures and 283 arrivals, with 41,673 passengers till 5pm on 26 May 2020.

May 26, 2020 / 22:23 IST
     
     
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    Even as some of the bottlenecks around flights resumption seem to have eased on May 26, industry executives have a new headache to deal with - the low passenger loads.

    Though the second day after domestic flights resumed may eventually see a higher number of departures and arrivals and more passengers taking to the air, the overall loads are lower.

    On May 26, airports in Vizag and Vijaywada also resumed operations, adding to the number. On the first day on Monday, there were 404 arrivals and 428 departures.

    Civil Aviation Minister Hardeep Singh Puri tweeted on May 26 evening that airports have handled 325 departures and 283 arrivals, with 41,673 passengers till 5pm on 26 May 2020. "Final report for the day will be prepared after details come in at midnight," he added.

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    But the increasing numbers will do little to mask the worrying part. While on May 25, the passenger loads were about 55 percent, these had dropped to about 40 to 45 percent on may 26, said Nishant Pitti, CEO, EaseMyTrip.com.

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    The highest loads are concentrated in Delhi and Mumbai. But in other metros, including Bengaluru, traffic has been low.

    "Flights to Bengaluru will be reduced by airlines as passengers are avoiding travel because of mandatory quarantine," said Pitti.

    Track this blog for latest updates on the coronavirus outbreak

    Industry executives expect the traffic to slow down further after the initial demand cools down. The low loads are despite airlines not operating even one-third of their schedule, as allowed by the government, until August 24.

    While it may be too early, but airlines may take a re-look at their schedule. IndiGo, the largest airline in the country, is operating more than 200 flights a day.

    Quarantine Protocol for Passengers

    The lower loads will also raise questions on the fare cap that the government has imposed on all the routes. For instance, in the Delhi-Mumbai route, the fare is capped in the Rs 3,500 to Rs 10,000 range.

    "Regulation of domestic airfares may need to be lifted before 24-Aug. The price floor in particular is likely to further soften demand as we head into the weakest quarter of the year," advisory firm CAPA India said on Twitter.

    "If necessary, the price cap could be maintained without any other conditions," it added.

    Airlines, already under a financial squeeze, will also push for a market-driven determination of fares. This is not just to have fares attractive enough to woo passengers, but also to bring about a competitive level in the rates.

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    Prince Mathews Thomas
    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: May 26, 2020 08:46 pm

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