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IndiGo Gains The Most From Jet Woes

IndiGo now has half the market share in India’s aviation space. 

An aircraft operated by IndiGo, a unit of InterGlobe Aviation Ltd., prepares to land at Chhatrapati Shivaji International Airport in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)
An aircraft operated by IndiGo, a unit of InterGlobe Aviation Ltd., prepares to land at Chhatrapati Shivaji International Airport in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

IndiGo gained the most as Jet Airways (India) Ltd. shut operations after battling a crippling cash crunch.

India’s largest carrier, operated by InterGlobe Aviation Ltd., saw its market share jump by eight percentage points in the last eight months at the expense of its grounded peer, according to data published by Directorate General of Civil Aviation. It now controls 50 percent share in the domestic market.

Jet Airways shut its operations temporarily on April 17 as it was left with no money to pay aircraft lessors, employees or buy fuel. While the regulator has already distributed its flying slots to rivals, the carrier’s troubles led to a slowdown in passenger growth.

The number of air travellers declined 4.5 percent over a year earlier in April, the biggest fall in at least six years, according to data compiled by BloombergQuint. All other major airlines including IndiGo, GoAir, AirAsia, and Vistara reported growth.

The number of passengers in April:

  • rose the most for IndiGo at 20 percent;
  • jumped at the fastest pace in seven months for GoAir at 18 percent;
  • grew at 17 percent for AirAsia India, the slowest since starting operations;
  • increased 12 percent for Vistara, the highest in three months.

Unlike other private carriers, Ajay Singh-led SpiceJet Ltd. failed to make the most of the opportunity. The airline not only reported the slowest pace of passenger growth in 42 months at 1 percent, but also lost the second spot to state-run Air India.

Occupancy declined year-on-year for most airlines as they added new planes to the fleet. Tata Group-controlled Vistara and IndiGo reported the biggest drop in passenger load factor. While SpiceJet has reported a 90 percent plus occupancy for 48 straight months, the reading has been falling for 11 months now.

Passenger Load Factor

  • IndiGo: fell 410 basis points to 87.8 percent.
  • Air India: down 280 basis points to 81.2 percent.
  • SpiceJet: declined 180 basis points to 93.7 percent.
  • AirAsia: fell 310 basis points to 84.4 percent.
  • Vistara: declined 420 basis points to 84.6 percent.
  • GoAir: Rose 130 basis points to 90.8 percent.
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