MIAMI – With passenger demand expected to fall 40-50% in India, several of the country’s carriers would park at least 150 aircraft, this according to the Center for Aviation (CAPA).
CAPA India estimates losses for Indian airlines from US$500m to US$600m during the first quarter of the year (January-April), excluding national carrier Air India (AI).
“In the absence of a serious and meaningful government intervention, such an outcome could lead to several Indian airlines shutting down operations by May or June due to a lack of cash,” said CAPA India in a report.
Even though several worldwide companies have been cutting capacity and canceling routes since February, air services in India avoided major reductions as the travel restrictions were only around China.
However, at the time travel bans began to increase, the air passenger traffic in the Asian country was about 9%, upsurging concerns.
IndiGo (6A), India’s largest airline, grounded 16 planes of its total fleet of 260 aircraft as the passengers demand lowered by 30% in India. Following the drop, the international schedule was affected after several governments imposed travel restrictions.
Also, 6A is asking employees to take between 10% to 20% of salary cuts to save money as all of its international flights were canceled, and its domestic schedule dropped 20%.
While “it is not clear that the situation will not get worse before it gets better,” and “the very survival of airline industry is at stake”, the company added that even knowing that the salary cuts are a tough pill to swallow, “unfortunately, it is impossible to fly through this economic storm without all of us making some sacrifice.”
In addition, Vistara (UK), the Indian operator for Singapore Airlines (SQ), will temporarily suspend all international flights until March 31 and adjust its domestic flights from that month through April.
As integrated saving cost actions, UK also would delay the delivery of the first ordered batch of Boeing Co. 787 Dreamliners, according to Bloomberg,
Go Airlines India (G8) was another company affected, suspending international routes and several domestic flights.
By now, the International Air Transport Association (IATA) forecasts an exacerbation of the crisis that is stifling the aviation industry due to the COVID-19. As a result, it is requesting a US$200bn bailout from worldwide governments for airlines to survive during the pandemic storm.
Airways will continue to report on the developments of these dire times for the aviation industry.