The Air India Express crash in Mangalore is not likely to dampen the domestic aviation industry?s growth in any significant manner, say experts.
Saturday morning?s crash adds to a list of imponderables that the airline industry has been grappling with of late, from the ash clouds disrupting European flights to bloody unrest in one of the most popular tourist destinations for Indians ? Bangkok.
?In the long run, it will not impact the industry as more people are flying in the recovering economy. There might be a slight slowdown in voluntary travel, but business travel will be largely un-impacted,? says KPMG director Amber Dubey.
No wonder many industry observers are dismissing Saturday?s tragic accident as an exception to an otherwise relatively clean record of safety norms and pilot training of the aviation sector in India, contrary to other reports on the uncomfortable number of ?near misses? reported in the last few years.
Economic buoyancy of the last six months and aggressive house-keeping by most players have helped improve airline yields, which were hit by the global downturn in 2008-09. Load factor of Indian carriers improved from 64% in 2008-09 to 73% last fiscal. The number of passengers carried by domestic carriers was 162.82 lakh in January-April in 2010 as compared to 133.41 lakh in the year-ago period.
Jet Airways, which has the biggest market share (along with JetLite) of 25.9%, posted a jump of 10.5% in net profit in the fourth quarter of last fiscal while analysts expect low-cost carrier SpiceJet too to post encouraging Q4 results.
?In last 12-15 months, capacity addition has slowed and demand-supply gap has been one of the lowest in last few years,? says Samyukth Sridharan, chief commercial officer, SpiceJet.
Adds Ramanjaneya Sharaph of E&Y, ?Airlines have adopted route rationalisation and have not expanded fleet, which has helped in growth.?