Air travel growth slips to 3.7% in 2019

The double-digit growth of domestic air travel seen in past few years crashed to 3.7% with 14.4 crore people flying within the country in 2019, against 13.9 crore in the previous year. The fall in growth, though still in positive territory, happened due to the collapse of Jet Airways last April that led to a sharp hike in air fares, amid an overall economic slowdown.

Aviation ministry’s quick grant of Jet’s slots to other airlines, with SpiceJet and Vistara taking ex-Jet Boeing 737s, and IndiGo growing at its one-plane-a-week pace, ensured that 2019 over 2018 did not see a fall in domestic air carriage.

The collapse of Jet saw full service airlines’ share in domestic air travel at 20.6% for the whole year with Air India at 12.7%, Vistara at 5.2% and Jet at 2.7% till it had its last flight on April 17, 2019. Low-cost airlines now account for over 80% of domestic air travel. IndiGo at 47.1% remained the market leader by a huge margin, followed by SpiceJet at 14.9%.

Industry insiders are keeping their fingers crossed. “The operating cost of running an airline in India is prohibitive due to high tax on jet fuel and a serious infra crunch at airports. The Kingfisher-Deccan combine shut down in 2012 and then there was a gap of seven year with Jet-Sahara combine collapsing in 2019. So the industry had some time to recover. But at the moment, Air India is in a precarious state financially. Its divestment must proceed successfully. We cannot afford two big airlines shutting down within a space of about a year,” said a senior official.

Jet had shut down in April and this month saw 4.5% less domestic flyers than same month in previous year. As Jet’s slots and aircraft were taken by other airlines, November 2019 saw 11.2% more domestic passengers than same month previous year.

However, this growth momentum lost pace in December with growth down to 2.5% (Dec 2019 over Dec 2018).

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