New connections, feeder traffic grew Vistara’s market share: CEO

Vistara CEO Vinod Kannan.

Near pre-Covid capacity deployment, along with higher feeder traffic for international travel emanating from new inter-city connections, led to a rise in Vistara’s market share, Vinod Kannan, the airline’s CEO, told Moneycontrol.

In July 2022, the full-service carrier became the second largest airline in India with 10.4 per cent domestic market share.

The Tata-Singapore Airlines joint venture also crossed the one million domestic passengers mark in July.

Data from the Directorate General of Civil Aviation (DGCA), the civil aviation regulator, shows that the airline’s market share was 8.6 percent in May with 0.98 million passengers, and 9.4 percent in June with 0.99 million passengers.

Near pre-pandemic capacity

Kannan said that the company’s business strategy involves investing in network growth and operational strength.

“Since the third quarter of FY22, we have been operating more flights than we were prior to the pandemic, barring January this year,” Kannan said.

“We have also surpassed our pre-pandemic levels of daily passengers,’’ he added.

The company used to operate 210 fights per day in February 2020. Now the number stands at over 250  domestic and international flights daily.

Feeder traffic feeding growth

The Volume push also came from higher feeder traffic from tier-I cities to metros, and onward to international destinations.

Recently, the full-service carrier introduced several new routes, like Mumbai-Srinagar, Mumbai-Ahmedabad, Mumbai-Bhubaneswar, Mumbai-Indore, Mumbai-Dehradun, Bengaluru-Indore, and Bengaluru-Pune.

““As an airline, network expansion remains our priority, and we are constantly monitoring opportunities in new markets. With more aircraft joining our fleet soon, we hope to be able to further expand our domestic as well as international network in the coming months,” Kannan added.

In the domestic sector, Vistara connects 30 destinations.

International drive

Apart from the domestic sector, the airline has witnessed a healthy growth in the demand for international travel.

Pre-Covid, the airline connected five international destinations. Today, it operates flights to 10 international destinations — Bangkok, Dhaka, Dubai, Frankfurt, Jeddah, Kathmandu, London, Male, Paris, and Singapore. Jeddah is the latest addition to its network. Last month, it announced daily connectivity between Mumbai and Abu Dhabi starting October 1, 2022.

“We have scaled up our frequency and now fly daily to major international destinations, like Singapore, London, Bangkok, Dubai, Kathmandu, and Dhaka,” he said.

Alongside expanding its international footprint, the airline has been forging partnerships.

Presently, it has interline or through check-in and codeshare partnerships with 40 major airlines around the world.

A codeshare or interline agreement allows airlines to sell seats on each others' flights in order to provide passengers with a seamless travel experience, and offers a wider choice of destinations to passengers.

More aircraft, more capacity 

Additionally, Vistara is awaiting the arrival of its third Boeing 787-9 Dreamliner, which is a leased aircraft. This aircraft is not a part of the six 787-9 Dreamliners ordered earlier, two of which are already at work.

“The third Boeing 787-9 Dreamliner will enable us to increase frequencies to Frankfurt and Paris by almost 100 per cent,” Kannan said.

At present, Vistara has a mixed fleet of 54 aircraft, which includes 42 Airbus A320s, five Boeing 737 800NGs, five Airbus A321 Neos, and two Boeing 787-9 Dreamliners.

Travel trends

According to Kannan, there has been a noticeable preference towards non-stop, direct flights, especially on long-haul routes.

“This is mainly due to reasons such as avoiding the risk of contracting the virus in transit, constantly changing travel guidelines and quarantine rules, etc.,” Kannan said.

He added that the pandemic had had a profound impact on consumer behaviour, mostly emanating from a heightened concern for safety and hygiene.

Growth forecast

Vistara forecast accelerated growth during the upcoming festive season.

In India, major festivals across the country are celebrated in the October–December quarter, which leads to a surge in leisure travel.

“We have been witnessing healthy demand across our network, and expect it to further grow in the upcoming festive season,” Kannan said.

Vistara commenced commercial operations on January 9, 2015, and has since flown more than 35 million passengers.