Bharat Express

Record-Breaking Start to 2023 for Indian Aviation Industry

First Quarter of 2023 Sees Bumper Growth in Indian Aviation with Over 128 Lakh Domestic Passengers

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The Indian aviation industry had its best Q1 ever with 375.04 lakh domestic passengers, and in March alone, 128.93 lakh people flew domestically. The airline industry has been facing various challenges, including a shortage of planes due to grounding, primarily affecting IndiGo and Go FIRST. Both airlines use Pratt & Whitney engines in some of their A320neo planes. Despite these challenges, IndiGo continued to dominate the market with over half the market share in March, while no other airline managed to reach 10%.

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IndiGo, the largest airline in India, maintained its dominance with a market share of 55.7% in Q1CY23 and achieved its best monthly performance in March by carrying 73.17 lakh passengers. Despite grounding of planes, the airline has been increasing its capacity utilization and holding on to its flights. It remains to be seen whether these efforts have helped the airline to improve its margins and reduce losses in the last financial year.

Air India was pushed to the third position by Vistara in March, but closed the quarter as the second-largest player in the Indian market. The collective market share of the three Tata carriers, including Vistara, is now 25.1%, which is lower than their target of 30% under the Vihaan.AI transformation plan. Vistara has been able to overtake Air India by achieving higher load factors despite having less capacity in the market.

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Talking about SpiceJet, which had the second-highest market share in the past, has dropped to the sixth spot in terms of market share as of March. Although the airline announced the induction of additional MAX aircraft in Q4CY22, it has not added any aircraft and has been expanding capacity through wet leases. Go FIRST has also lost market share, with its traffic falling below AirAsia India, which is now in the fourth spot after Tata carriers Air India and Vistara.

Go FIRST has been facing issues due to the grounding of its aircraft as Pratt & Whitney has not been able to provide replacement engines. This has caused some of the airline’s aircraft to leave the fleet, while many others remain grounded, awaiting engines. Despite these challenges, both SpiceJet and Go FIRST had high load factors in March, with SpiceJet continuing to have the highest load factor in the industry.

In Q1CY23, the number of passengers on domestic flights in India was 375.04 lakh, which is slightly less than the best-ever quarter (Q4CY19) when 381 lakh passengers traveled. As the high season of April to May approaches, there is uncertainty about the economic situation due to the rising cases of Covid-19 in the country. Although popular holiday destinations are reporting high booking rates for May, April has not met expectations in terms of the number of passengers or flights.