Airlines add new flights as air travel takes off

Crisil expects domestic air passenger traffic to reach pre-Covid levels by FY23 end or the beginning of FY24, and international traffic to reach the same by FY24.

Airlines add new flights as air travel takes off
IndiGo started flights to Deoghar, its 74th domestic destination, and announced Bahrain as its 25th international destination earlier this month.

With the passenger traffic moving towards the pre-pandemic levels, airlines are augmenting their flights on both domestic and international routes. In May 2022, domestic and international air passenger traffic reached 93% and 72%, respectively, a level last seen during May 2019. Crisil expects domestic air passenger traffic to reach pre-Covid levels by FY23 end or the beginning of FY24, and international traffic to reach the same by FY24.

“After more than two years of restrictions, pent-up demand is driving travel desire. Despite capacity constraints and increased aviation turbine fuel (ATF) price resulting in a 25-30% rise in airfares, travel sentiment is at an all-time high,” Indiver Rastogi, president and group head, global business travel, Thomas Cook (India) and SOTC, told FE. We are witnessing strong demand from both corporate and leisure segments with a shift in consumer behaviour (corporate travel) as the customers who preferred travelling by trains are now opting for airlines to save time, he added.

From a leisure perspective, Thomas Cook (India) and SOTC witnessed a surge of 250% in flight bookings across domestic destinations in February over January, albeit over a low base, with the subsequent months recording a 30-35% uptick. The companies are registering a “sustained growth” in business travel, which is almost at par with the pre-pandemic levels now.
Since the resumption of international flights and easing of travel/health protocols globally, Thomas Cook (India) and SOTC have seen a growth of 25% month-on-month in flight bookings. Rastogi said that Indian consumers are willing to pay more than 25-30% of pre-pandemic fares.

“We have certainly witnessed a growth in air travel bookings as the market sentiment is positive right now due to revenge tourism. We have already reached our pre-Covid numbers and, in fact, saw an increase in CAGR of 78% during FY20-22 in profits,” said Nishant Pitti, CEO and co-founder, EaseMyTrip. The company claimed that it has registered a jump of nearly 30-40% in transactions for domestic and international flights after they restarted.

IndiGo started flights to Deoghar, its 74th domestic destination, and announced Bahrain as its 25th international destination earlier this month. The airline has also increased frequencies between Delhi-Leh, Delhi-Srinagar and Lucknow-Pantnagar.
SpiceJet, which received a show-cause notice from the Directorate General of Civil Aviation (DGCA) on July 6 after multiple technical malfunction incidents involving its planes were reported, announced the launch of 26 new domestic flights on July 19. The airline will connect Nashik with Hyderabad and Delhi with Khajuraho with new and additional flights, respectively, apart from introducing a host of direct flights from Delhi to Nashik, Hyderabad to Jammu, and Mumbai to Guwahati, among others.

Vistara added a new route to its international network with direct connectivity between Mumbai and Bangkok earlier this month. It recently increased the frequency between Delhi and Bangkok to daily flights. Last month, it had announced non-stop flights between Jeddah and Mumbai. Go First announced direct flights from Kochi to Abu Dhabi last month, apart from resuming direct flights to and from Srinagar to Sharjah.

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