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Crunch in seat capacity behind high domestic air fares

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 India has a fleet of around 422 aircraft for a population of 1.2 billion. (Reuters) India has a fleet of around 422 aircraft for a population of 1.2 billion. (Reuters)
SummaryAt 2,30,000 seats, airlines agree capacity addition by them has not kept pace with rise in demand.

In comparison, China has a fleet of 1,981 aircraft for 1.3 billion citizens.

A Centre for Asia Pacific Aviation data also shows that the number of domestic airline seats per capita is one of the lowest in India at just 0.07. This compares with 3.35 for Australia, 2.49 for the US, 1.38 for Canada and 1.05 for Japan. Yet to cater to demands of the aspiring middle class population (with annual income of Rs 5 lakh and above) of the country, which the travel and tourism industry estimates to be around 5 per cent of the countrys 1.2 billion people the availability of seats has to rise.

Air pockets

Airlines need to ramp up their capacity to 1 million domestic seats a day which is four times more than the current 2,30,000 seats a day they are offering

This shortage has pushed airlines to announce plans to buy or lease aircraft continuously with a target till 2024

The industry can keep up its growth momentum only if it can balance between adding capacity to keep fares low and keep the rates high enough to break even.

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