Over 160 Aircraft Grounded in India as Airlines Face Capacity Challenges

The aviation industry in India is grappling with a significant challenge as more than 160 aircraft from various airlines remain grounded. This grounded fleet includes over 90 aircraft from India’s largest airline, IndiGo, followed by approximately 25-30 aircraft each from Air India (backed by the Tata Group) and low-cost carrier SpiceJet. Additionally, 54 aircraft of Go First have been grounded since the airline suspended its flights in May.

CAPA India, a prominent aviation consultancy and research firm with over 20 years of experience and more than 700 global projects for over 300 clients, has reported these findings. CAPA India is known for providing game-changing solutions to the aviation, aerospace, and travel industries with independence and integrity.

As of the latest data, IndiGo alone has 55 aircraft grounded, according to CAPA. The consultancy anticipates that the grounded fleet size may increase further.

CAPA India projects that by March 2024, the Indian aviation sector will have a fleet size of nearly 790 aircraft, out of which 588 are likely to be operational. The research firm also anticipates delays in aircraft deliveries for India’s youngest airline, Akasa Air.

In terms of passenger numbers, CAPA India estimates that domestic and international passenger traffic for the current financial year will reach around 155 million and 70 million passengers, respectively. According to the Airports Authority of India and the Directorate General of Civil Aviation, Indian airports recorded 57 million international passengers and 136 million domestic air passengers in the 2022-23 fiscal year (April to March).

CAPA India highlights supply chain issues as a critical risk that could have a more significant and strategic impact than anticipated, potentially affecting the operation of scheduled airlines and the UDAN flight program.

Furthermore, the research firm notes that the wet lease aircraft fleet in India is expected to reach approximately 30 by March, as both IndiGo and SpiceJet are inducting capacity through this model, leasing aircraft along with crew.

Regarding airfares, CAPA India observes a return to normalcy despite capacity constraints. Average fares declined by 12.7% year-on-year in the September quarter, and while some weakness is expected in the March quarter, full-year yields are likely to be around 3% lower year-on-year. This is expected to result in higher losses for full-service carriers like Air India and Vistara compared to earlier projections.

CAPA India concludes by emphasizing that the growth momentum in the Indian aviation market will continue. International operations are gaining prominence and will receive an increasing share of planned capacity.