Indian-Aviation

It took 200 million pounds ($250 million) of Richard Branson’s own money to secure the rescue of his Virgin Atlantic Airways Ltd. The outlay marks the latest example of the industry’s enduring capacity to shrink fortunes, although the British billionaire may not be surprised, having once said: “If you want to be a millionaire, start with a billion dollars and launch a new airline." The airline business has long proved irresistible to a cohort of larger-than-life tycoons. From AirAsia Group Bhd’s Tony Fernandes to JetBlue Airways Corp. founder David Neeleman, some of the world’s most celebrated entrepreneurs have built fortunes shuttling people through the sky. But with air travel dwindling in lockdown, coronavirus has battered even those long hardened to the volatility and thin margins of the capital-intensive industry. The market values of 10 large, publicly traded airlines linked to prominent magnates tracked by the Bloomberg Billionaires Index have fallen in value by $14 billio...

Indian airlines are staring at a revenue loss of  ₹ 1.3 trillion between fiscal 2020 and 2022 due to the ongoing covid-19 pandemic that has severely hit demand, rating agency Crisil said in a report on Wednesday. Airlines are also unlikely to recoup from this loss and bounce back to pre-pandemic levels of double-digit growth at least in the medium term, said the report. "One would have assumed that the expected plunge in crude oil prices to $38-42 per barrel in fiscal 2021 compared with $64-66 per barrel in fiscal 2020 would have helped airline companies to an extent on the margin front as it forms a sizeable 30-45% of an airline’s cost base," the report prepared by CRISIL Research said. "But because of the outsized impact of the demand destruction, airlines are curtailing capacity deployment, thereby restricting opportunities for airline companies to accrue the benefit of low crude oil prices," it added. Meanwhile, airfares, which are currently capped by the govern...

Economy on Vistara As one of only two  full-service carriers  in India, Vistara offers a high-quality economy product. On its A320, which used on most domestic routes, it offers 18-inch wide seats with a pitch of 29-30 inches. While this does sound standard, the well-padded seats and adjustable headrest make for a much more comfortable offering than its low-cost competitors. The seats also offer an acceptable 3″ recline. In terms of service, Vistara is one of the few airlines offering hot meals on domestic routes (minus short routes under an hour). All economy passengers, except those booked on Economy Lite fares, receive a meal along with hot or cold beverages. From personal experience, the meals are good and enough for domestic hops. For those traveling on Lite fares, only complimentary hot beverages are available. Vistara also has a small buy-on-board menu, which features packaged snacks and drinks, along with some hot instant meals. Originally, the airline served all passe...

The passenger demand for air travel will contract by 49% this year for Indian carriers in comparison to last year due to the COVID-19 crisis, said global airlines body IATA on Monday. In a statement, the International Air Transport Association (IATA) said the Indian carriers' revenues will decrease by $11.61 billion this year in comparison to last year due to the pandemic. It said the airlines of the Asia-Pacific region will see passenger demand collapse by 53.8% this year in comparison to last year. The passenger demand or RPK (revenue passenger kilometers) for a flight is calculated by multiplying the number of passengers sitting in the flight to the distance travelled by that flight. "This is the worst year in aviation history and airlines are in survival mode. The carriers in Asia-Pacific will experience the largest losses at USD 29 billion. That's a loss of USD 30.09 per passenger," Conrad Clifford, IATA's Regional Vice President for Asia Pacific, said. ...

Aviation is among the worst-affected sectors amidst the Covid-19 crisis. While IndiGo is using this time to gain more market share among passengers, SpiceJet is looking to strengthen its position as cargo transporter. The number of passengers taking flights daily has doubled from the levels seen at the end of May but there is still a long way to go before airlines are financially comfortable. This is the estimated loss for the period of April to June 2020. IndiGo recently launched “flex pay” for its passengers wherein they can avail the flexible payment option. The scheme allows the passengers to secure their bookings by paying only 10% of the total fare amount and defer the rest of the payment to the airline for a period of up to 15 days either from the date of bookings or before the date of departure. Bhavin Shah, fund manager at Sameeksha Capital, told Business Insider that this scheme will attract more customers for IndiGo. “The whole ticketing business works on negative working ca...

Tata Sons is reportedly planning to shed its entire holding in loss-making AirAsia India, its joint venture (JV) with AirAsia. Tata Sons presently holds 51 percent majority stake in the company, while AirAsia Bhd owns 49 percent. In India, the airline commands a 7.8 percent market share. A source  told  Mint that AirAsia Bhd approached the Tata Group in June to sell its 49 percent stake, but latter used its first right of refusal as per terms of the joint venture to reject the move. “Tata is not very keen on staying invested in AirAsia India. AirAsia’s Malaysian partner had approached Tata Sons to sell its 49 percent stake, but Tata has not accepted the offer. In fact, the plan, which is in a preliminary stage, is to exit holding in AirAsia India and focus more on Vistara," a second source said. AirAsia has been hit hard by the coronavirus pandemic. In fact, International Air Transport Association (IATA) expects the Asia-Pacific region to clock  $29 billion in l...

National carrier Air India has terminated 200 cabin crew members and refused to accept the withdrawal of resignations of 50 pilots, officials aware of the matter said. The cabin crew members were contractual employees. The officials said the 50 sought to withdraw their resignations after private airlines rescinded their jobs offers they had put in their papers for amid the Covid-19 pandemic that has hit the aviation industry hard. The airline refused to accept their requests and instead asked them to serve their notice periods. The airline management and civil aviation ministry officials met the pilots on July 8. Air India spokesperson refused to comment on the terminations, saying: “These are internal issues on which we won’t like to make any comment.” A pilot said, “We knew about this step by the airline, and hence we had written to them and even discussed in the meeting that they should not lay off only the frontline warriors...” A senior airline official said layoffs were bound to ...

The  Civil Aviation Ministry  has told the  airlines  that passengers who submit a self-declaration form that they have not tested positive for COVID-19 during the three weeks prior to the departure date are allowed to take their flight, officials said. On May 21, the government had made it mandatory for all passengers to submit the self-declaration form before a flight stating that they did not test positive for COVID-19 during two months prior to the departure date. The officials told that as there are a large number of people in India now who have recovered from the deadly virus, a need was felt to update the self-declaration form to avoid any hardships to them. Therefore, a few days back, the government told the airlines that passengers need to give a declaration that "they have not tested positive for COVID-19 in the last three weeks" prior to the flight, the officials said. "Persons who have recovered from COVID-19 and who fulfil the three-week criteria will be...

The Indian aviation industry comprises of one of the most cost-sensitive passenger demand in the world. The reason behind this might not be purely financial but also cultural. On average, a flight from one corner to another corner of India doesn’t take more than 2.5 hours. Hence, Indians, in general, are more inclined towards spending less than experiencing premium service for such a small period. Around the early 2000s, the Indian government had opened the airline industry for private carriers. Since then, low-cost carriers (LCCs) like IndiGo and SpiceJet have turned the dynamics of the airline market. Growth of Low-cost carriers in India As of now, LCCs possess more than 80% of the market share. Since 2009, the expansion of Indian flight capacity has made it consistently one of the world’s fastest-growing markets. The LCCs drove most of this growth. In total, the number of available departure seats has more than doubled, swelling by 114.5% to 206 million in 2018. However, the increas...

Air India  has withdrawn job offers for around 180 trainee cabin crew members amid the economic slowdown in the  Indian aviation sector  due to the  coronavirus pandemic , said  airline officials  on Saturday. "The airline has taken a decision to withdraw job offers for about 180 trainees who were to join as cabin crew after completing their training as the aviation sector has been hit hard due to the coronavirus pandemic," said an airline official. In a letter sent to one such trainee cabin crew member on July 6, the airline said, "In view of the current aviation scenario, it would not be possible for Air India to impart any further training to you for engaging your services." The letter also said, "In view of above reasons, which are beyond the control of the company, it has been decided to discontinue your training arrangement and dispense with the offer of engagement with immediate effect." It further said the bank guarantees furnished by the individua...