NEW DELHI, May 27: Air India, its low-cost subsidiary Air India Express, and IndiGo will together withdraw around 250 daily domestic flights from June amid rising aviation turbine fuel (ATF) costs which may further drive-up airfares.
Airlines are also reporting weakening demand and subdued travel sentiment in what is already considered a traditionally weak season as travel demand typically softens from mid-June onwards after the summer holiday period concludes.
Air India will cut 22% of its domestic flight schedule during June and July. The airline currently operates around 3,600 weekly domestic flights, nearly 500 flights a day, meaning the reduction will translate into roughly 110 daily flights being withdrawn.
IndiGo, which operates nearly 2,200 daily flights, will reduce its domestic capacity by 5%, amounting to around 110 flights a day. Air India Express will cut nearly 10% of its approximately 340 daily flights on domestic routes. The three airlines together enjoy 90% of the market share, that is nine out of 10 air travellers fly with one of them.
“These adjustments are driven by the sustained impact of high fuel prices on overall operations. Air India will continue to monitor demand and operating conditions closely,” Air India said in a statement.
IndiGo sources said a 5% cut was due to softer demand as travellers cut back on discretionary spending on top of it being a lean travel season following the summer holiday rush.
A 25% rise in aviation turbine fuel (ATF) prices for domestic flights and nearly a 100% increase for international operations due to the West Asia conflict has sharply raised operating costs for airlines, pushing airfares up by 40-50% on several routes. Airlines had also imposed a fuel surcharge of Rs 400 to 450 in response. Industry observers say the latest capacity cuts could drive fares even higher.
Several airlines have in the meanwhile started restoring capacity on West Asia routes as airspace restrictions ease across most destinations in the region, with Kuwait remaining among the few exceptions.
“Air India Express now operates about 500 weekly flights between India and West Asia, up significantly from around 280 weekly flights just a few weeks ago, with services restored progressively across 11 airports in the region,” Air India Express said in a press statement.
(Manas Dasgupta)
