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Domestic Passenger Traffic To Decline By 41- 46% In FY21

Domestic passenger traffic to decline in capacity in July 2020 despite resuming operations over two months ago. 

Airlines operated at a lower capacity of 27% in July 2020 compared to July 2019 capacity, which was a slight increase over the 25% capacity in June 2020. The domestic passenger traffic for July 2020 was 20.6 lakhs against 118.6 lakhs in July 2019 which is a decline of 83%. A sequential improvement of 4% over 19.8 lakhs was witnessed in June 2020. A while ago, the Ministry of Civil Aviation(MoCA) allowed an increase in capacity to 45% with effect from June 27, 2020, post the initial resumption of operations of scheduled domestic flights with effect from May 25, 2020, to a limited extent that is the maximum 1/3rd of their respective approved capacity of Summer Schedule 2020.

The Vice President of ICRA, Kinjal Shah, said: “The number of flights departing has also gradually increased from 416 on Day 1 to 890 on Day 69 (July 31, 2020). For July 2020, the average daily departures were 780, significantly lower than the average daily departures of 2,845 in July 2019, though better than 723 in June 2020. The average number of passengers per flight during July 2020 was 86, as against an average of 134 passengers per flight in July 2019. Thus, it is expected that the domestic aviation industry operated at a passenger load factor (PLF) of ~55% in July 2020, as against 86.3% in July 2019, that too on very low capacity. The PLF for July 2020 has sequentially moderated from ~58% in June 2020 due to the increase in capacity deployment by ~11%. ICRA maintains that H2 FY2021 will witness some recovery, with Q4 FY2021 witnessing YoY de-growth of just 3-14% in domestic passenger traffic with improved PLFs, and overall FY2021 witnessing ~41-46% de-growth in domestic passenger traffic.”

MoCA fixed a fare brand within which airlines are to charge fares

The MoCA fixed a fare brand within which the airlines are to charge fares, to ensure that the airlines do not charge excessive fares and also that the journey is performed only for essential purposes. The restrictions on capacity and fares have been extended further from August 24, 2020, to November 24, 2020.  

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