Domestic air travel bookings pick up pace amid festive season

Airlines, however, remain cautious of a potential third wave of covid-19, mindful of the severe dent to business during May and June this year when the second wave erased gains made in the months before.

Domestic passenger traffic improved to about 4.52 million in the first three weeks of August, up from 3.31 million, 1.91 million and 1.41 million passengers in the same period during July, June and May, respectively, according to data collated by aviation website NetworkThoughts.

Air traffic in the same period during February, March and April stood at 5.73 million, 5.30 million and 4.40 million passengers, respectively.

“Advance bookings (especially for travel beyond the 14-day window after booking) have picked up in August. This shows that people are more confident to travel now, which is due to the declining number of active covid cases and the removal of travel restrictions by states,” a senior executive at a Gurugram-based budget airline said, requesting anonymity.

“Going by the current figures, we are hoping for air ticket sales to pick up further during the festive season. If the current growth continues unhindered, we could see a recovery to pre-covid levels by October-December period,” the official said.

Meanwhile, airlines are shoring up their liquidity to prepare for any business disruption from a potential third wave.

Two of the country’s listed airlines—InterGlobe Aviation Ltd operated IndiGo and SpiceJet Ltd—have both received approval from their respective boards to raise capital through qualified institutional placements.

IndiGo and SpiceJet plan to raise up to ₹3,000 crore and up to ₹2,500 crore, respectively.

The government currently allows domestic airlines to sell seats up to 72.5% of their pre-covid capacity, and has also increased the minimum and maximum limits on fares.

Passenger traffic is expected to sustain its growth momentum in the coming months.

This would hinge upon the country averting a third wave of the pandemic, leading the government to further ease the cap on seat capacity.

“We are encouraged by the demand in the last few weeks which is demonstrated by the fact that our market share is now 8.1%. Also, the capacity and passenger carriage this month should be close to March 2021 based on the current trends,” said Vinod Kannan, chief commercial officer, Vistara. “The demand in August is expected to return to pre-covid levels barring any further shocks.”

Spokespersons at IndiGo, SpiceJet, GoFirst and AirAsia India did not respond to emailed queries.

India’s domestic air passenger traffic is expected to jump 52% this financial year, while international passenger traffic will surge 60%, though overall passenger traffic is expected to remain well below the FY20 figures, aviation consultancy Capa India said in a recent report.

The senior airline executive cited above said a recovery in leisure travel will be key for airlines to bounce back to pre-covid levels.

“As of now, most air travel falls under the VFR (visiting friends and relatives) segment. However, we are hopeful that leisure and business travel will pick up during the festive season. This will, however, depend a lot on the occurrence of the third coronavirus wave,” the executive added.