Airlines Logging Near Full Capacity Operation; Airfares Turn Attractive

While fears remained that flyers would remain cautious and avoid air travel, it has been reported that airlines are operating at near full capacity. Also, low-frill air carrier such as Indigo for some of the sectors is witnessing overbooking. Further as per the latest load data released, Go Air which restarted its air services from June 1, 2020 has logged 70-80% average passenger load factor to some of the destinations and for some of the sectors such as Varanasi and Lucknow clocked 100% load.

Airlines Logging Near Full Capacity Operation; Airfares Turn Attractive

"(IndiGo) flights to and from most metros had near full bookings. Patna, Bhubaneswar, Ranchi, Cochin appear to enjoy steady flow of passengers. Some sectors even saw overbooking. The trends show that the fear and apprehension have slowly dissipated as travellers learn to live with the virus," an aviation industry executive is quoted as saying in a leading business daily.

The demand pick up has brought in a sense of relief to the beleaguered aviation industry which suffered the most in the wake of stretched lockdown for over 2 months.

In the wake of the disruption caused due to the Covid 19 outbreak for the year 2020,airlines are allowed to fly at up to 33% of their previously allowed summer flights scheduled for the year.

The pick-up in demand for the airline industry has also helped the banking industry which has extended loans to players in the sector.

"Our bookings data shows there is a rise in travel from non-metros to metros as offices resume operations. Bookings across key routes in June have increased by 45-50% as compared to May last week when domestic flights had just reopened. Airfares have also decreased 20-25% week-on-week, making flying an attractive option for all travellers planning their immediate trips," said Aloke Bajpai, chief executive officer and co-founder of Ixigo.

Currently as the airlines at running at their minimal flight capacity, it is estimated that to cover up for the loss in revenue as well as high fixed cost during the lockdown will need a funding to the tune of Rs. 35000 crore until 2022-23, said ICRA in a recent release.

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