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Festive season cheers up airline biz

Call it divine intervention. The festival season that has just begun promises to bring good cheer for the beleaguered aviation sector in the country, reports Samiran Saha.

india Updated: Sep 25, 2009 22:45 IST
Samiran Saha

Call it divine intervention. The festival season that has just begun promises to bring good cheer for the beleaguered aviation sector in the country.

Load factors are looking up; passengers are coming back to airlines and at the same time are willingly paying some high prices for air travel.

So, is a turnaround in sight for the sector? Analysts are not sure yet, because they say it is not unusual for traffic to pick up during the festival season. But there is certainly a great deal of optimism. An economic recovery widely seen and expected is expected to give a long-awaited lift-off after the runway momentum picked up in the festival rush.

“Festive season always marks the beginning of growth for the aviation sector. Substantial growth is in offing in the coming months and low cost carriers will largely drive the growth.” Kapil Kaul, the India head of the Centre for Asia Pacific Aviation, a consulting firm, told Hindustan Times.

Latest official figures show passenger traffic remained largely unchanged during July and August with all eight domestic airlines carrying 3.59 million and 3.63 million passengers, respectively.

September, however, showed a marked improvement.

In the first three weeks of this month, there has been a 14 to 15 per cent rise in passenger traffic compared with the same month a year ago.

The seat load factor – the number of seats occupied per 100 seats in an aircraft—has also seen a sharp rise.

“We carried about 27,400 passengers on the weekend beginning September 11 and hope to overshoot this number by last weekend of the month,” an Air India spokesman said.

The state-run carrier has so far recorded a seat load factor of 73 per cent in September.

“As ticket prices are not very high passengers are coming back. The festival season also marks the beginning of holiday season and we are hoping for better loads,” the spokesman said.

Low-cost carriers, now the preferred mode of transport of frequent flyers, are also witnessing good load factors.

SpiceJet recorded about 75 per cent load in the first weekend of this month while it clocked 86 per cent last weekend. It expects to surpass the figure in the current weekend, aided by a festival rush.

“Traditionally load factors soar during the festival weekends. We expect better loads in the coming months as the holiday season has also started,” said a Spice Jet official, who did not wish to be identified.

Jet Airways, still nursing its wounds after a five-day strike by its pilots earlier this month, has also seen good loads in the past few weeks.

“Last week we witnessed a load factor of over 70 per cent and are inching towards the high 70s. The festive season looks very encouraging and we expect to touch the 75 per cent mark,” a Jet Airways spokesperson said. Long weekends with festivals have also led to good loads for Kingfisher Air.

“Last several weekends have been long and have witnessed a healthy increase in passenger traffic. This will continue the next month also as the holiday season rush will also pick up,” the airline’s spokesman said.

With economists projecting a turnaround in the broader economy in the coming months, it could only mean good news for aviation companies haunted by turbulent weather. “The upward trend in passenger traffic is likely to continue beyond this season unless retarded by any economic, political or security crises,” Kaul said.