IATA: India leads in October domestic capacity growth

India's domestic airline capacity jumped the highest in October of all major global regions, according to airline grouping International Air Transport Association (IATA). The airline capacity measured in average seat kilometer (ASK) was up 9.6%, while Brazil was the second highest at 7.8%, followed by China at 2.2% and the US at 0.8%. Australia and Japan declined around 0.5% and 0.2% respectively. Fast-growing Chinese domestic demand is being met with increased use of wide-body aircraft," IATA, which represents some 330 airlines and comprises more than 80% of global air traffic, said in its note on Wednesday. Globally, total air travel demand, measured in revenue passenger kilometers (RPK), was up 7.1% compared to October 2023, IATA noted adding, even as total capacity was up 6.1% year-on-year. The October load factor was 83.9% (+0.8ppt compared to October 2023). Much like China, Indian carriers like IndiGo, which have nearly 70 of their 390 planes grounded due to the glitches in Pratt and Whitney engines, have leased over a dozen aircraft to fill in for the shortfall and are also asking the government to allow them to lease wide-body planes to cope with the supply-chain throttled environment. India does not allow long-term wet leases of wide-body planes but has allowed some airlines, including IndiGo, to lease Boeing 777 from Turkish Airlines. The airline is seeking permission for more leases, as the previous ones have expired. IndiGo flew these leased Boeing 777 planes back to Turkish Airlines headquarters in Istanbul, potentially freeing up its Airbus A321s, which it could then deploy in the domestic market. While IndiGo adds one plane a week, Air India is expanding with nearly the same frequency. Cash-strapped and heavily shrunk, SpiceJet, which recently won around $400 million in funding from a clutch of investors, has also brought some of its planes back to life. These airlines do not want to lose their grip on the local market, and on November 17th, for the first time, India’s domestic traffic exceeded half a million passengers flown in a single day. However, this growth comes after a long hiatus. Jet Airways, one of India’s biggest airlines, went bankrupt in 2019 after flying for nearly 25 years, leading to a giant shockwave. The following year, Covid hit the world, leading to a severe slump in passenger traffic. Still, India’s domestic traffic of around 80 million is expected to reach 300 million by 2030.

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