Indian Aviation prepares for dogfight

This is not the first time that Bhatia has returned to the cockpit. In 2018, when then-CEO Aditya Ghosh abruptly resigned, he took the reins as interim CEO. As MD, he will focus on driving the airline’s domestic and international commercial strategies as well as maintaining its leadership position.

IndiGo operates an all-Airbus fleet of 276 aircraft. The airline’s 35 ATR 72-600 turboprops are again manufactured by a JV between Airbus of France and Leonardo of Italy. One of IndiGo’s main features has been to buy Airbus planes at some of the lowest prices in the world, which should serve them well in the face of intensifying competition. Since its inception, the airline has always focused on connecting with large, medium and small cities. “We are closely monitoring current trends in air traffic, rail passengers as well as the economic situation. Based on all these factors and various demand estimates, we are working on new routes and new flights,” says Dutta.

With the lifting of restrictions on international flights, IndiGo plans to restart operations on these routes. “We will take every possible opportunity to return to the previous 24 destinations we operated before the pandemic and expand our network to other destinations within six to seven hours with our narrow-body aircraft,” adds Dutta.

Attributes such as slots on all metro lines, high aircraft-to-destination ratio, regular schedule resulting in good punctuality, massive profits from sale and leaseback, suitable cost optimization and a strong ecosystem of travel and aviation services have all helped IndiGo solidify its position in the market. “It is also very important for a market like ours to have stable players like IndiGo, an Indian operator sought after worldwide for the transaction and leasing of aircraft in India. There is no doubt that they have managed to run a low-cost airline despite all odds and in doing so, have also created a level playing field for all Indian operators,” says Neha Singh, Associate Partner at law firm Link Legal.

After recording losses for several consecutive quarters, the carrier recorded a profit of 130 crore for October-December 2021. “As a market leader, IndiGo will have to protect and maintain its market share and profitability in a new environment of competition,” says a senior executive at an aviation consulting firm.

“Among current airlines, IndiGo has sufficient cash balance – about 17,300 crore in December – to cover more than 18 months of cash burn, far more than less than six months for its peers,” says Karan Khanna , aviation analyst at Ambit Capital. Thus, the airline could prioritize the defense of market share rather than profitability in the short and medium term.

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