Domestic airlines allowed to operate at up to 45% of total capacity

A cash balance of Rs 20,376 crore gives IndiGo the cushion to operate flights on one way with lesser load , but make money in the other direction where it gets a full flight
The government has allowed airlines to increase flights up to 45 per cent of their total capacity, against the previous cap of one-third, aviation regulator Directorate General of Civil Aviation said on Thursday. 

Indian airlines resumed their domestic operations from 25 May after being grounded for two months due to the lockdown to contain Covid-19 pandemic.

A senior government official said data has proved that air travel is the safest mode of transport due to its controlled access and complete traceability at departure, transit, and arrival. Less than 1 per cent of people who have taken a flight since 25 May have been detected carrying the virus.

Also, only when a substantial portion of the domestic routes are functional, overseas flights can resume. International routes depend on traffic feed from domestic flights.

Airline executives said that demand was primarily unidirectional, meaning the aircraft are flying on one route with little passengers. This paper had earlier reported that data from travel firms show that over 90 per cent of bookings have been for one-way trips and on non-metro routes, indicating little demand yet for business travel.

However, market leader IndiGo is buoyant about the increase in flying capacity, as it is seeing signs of growth in seat occupancy after resuming domestic operations, Chief Executive Ronojoy Dutta recently told Business Standard. The booking trend was encouraging, with growth in load factors and unit revenue, Dutta said. “Future bookings are coming along nicely,” he said. 

A cash balance of Rs 20,376 crore gives IndiGo the cushion to operate one-way flights with lesser load. It makes money in the other direction where it gets a full flight.



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