Fewer people fly IA after merger
20 June 2008
New Delhi: Lesser number of Indians are boarding the flag carrier post the unification merger of Indian Airlines and Air India.
According to DGCA data, the former Indian Airlines has the lowest seat load factor amongst domestic airlines this year, despite brand new planes in its fleet. Apparently, the post-merger hiccups are costing the Air India domestic more than just internal troubles, with the bulk of its customers choosing to fly other domestic carriers.
Prior the the merger, Indian Airlines could boast a front running position in load factors amongst domestic carriers, However, that was before any consolidation had taken place in the national aviation industry, and Jet, Sahara, Kingfisher and Deccan were independent airlines.
With growth falling to single digits during tough times brought on by the spiralling international oil prices, the May 2008 load factor for Air India (domestic), which measures the average passenger per flight, was at 61.2 per cent. Most other airlines fared better. Between January to May 2008, Air India's domestic load factors have ranged between 61.3 per cent to 58.3 per cent, with each monthly number posting a new low in the industry. The load factor for other airlines averaged at around 78 per cent during this period.
Air India admits to a drop in capacity in spite of the induction of new aircraft into its fleet, with the merged airline's capacity in the domestic market remaining more or less stagnant for past two years. Industry capacity on the other hand has seen consistent increases, which has translated into a drop in capacity share for Air India domestic. Moreover, the new planes in its fleet have only started to arrive now, after most other airlines have beefed up their fleets.
The aviation ministry is now worried that last fiscal's domestic carriers loss of around Rs4,000 crore could be compounded this year, with Air India taking on the largest chunk. Another factor responsible for watering down the numbers is the fact that being a national carrier, Air India has to deploy capacity in remote areas, which sees its capacity spread wafer thin over 60 airports within India. Revised duty timings as per the new duty time limitation rules has also reduced crew availability for the airline, shrinking operations by three per cent in spite of the new planes.