Wednesday, May 29, 2024

The Great Race, Commercial Airlines Competing For The Winners’ Cup

By Vijay Grover

Vijay Grover
Vijay Grover, Editor

The Great Race is all set to begin as the domestic aviation sector in India sees two major countdowns. The much awaited reset and revamp of Air India, Vistara and AirAsia operations, and Jet Airways, after the success of the proving flights this week, Jet Airways is all set to raise the curtain on its second innings.

Amidst this exciting landscape, passengers are hoping to see Air India step up and claim its position on centre stage; however, they also hope to see Jet provide stiff competition to the players having earned a reputation as an efficient full service airline before its abrupt exit from the market in April 2019.  

CEO Sanjiv Kapoor at its helm spares no effort to ensure that Jet Airways faces the strong headwinds comfortably. Sanjiv Kapoor who comes with stellar credentials has played a vital role in the success of Vistara and Spicejet and is now raring to fly with Jet’s revival plan.

The airline completed proving flights in May and expects an AOC soon. It is bringing back its old team of employees who were left without jobs with huge arrears when the airline shut after former boss Naresh Goyal deserted it.

Sanjiv Kapoor, addressed the employees in an open and inspiring letter. His message was clear; setting the tone for a long-term mission. In his letter, he said, “I truly believe that we are creating history together, and we are just getting started! As I love saying, this is a marathon, not a sprint. It’s going to need all of us to come together, help each other out, back each other, and, above all, reach for the stars.” 

He talked about the challenges the airline faces and the employees should prepare for them by being more efficient and focusing on keeping the customer in the centre of all efforts. “We are in the people and customer service business, we just happen to fly planes! Professionalism is sacrosanct here. We will always maintain the highest standard of professionalism, whether it’s in our dealings or in our appearances, at work or outside of work. The same high standards must also reflect in the smallest and biggest of our actions,” said Sanjiv Kapoor.

These are exciting times for Indian aviation, where travel is expected to return to pre-pandemic levels in the current financial year. Operators are beginning to see a stable growth in domestic air passenger traffic. Most airlines clocked 80% + passenger load factor in the current month of April 2022, sending a strong revival signal. India’s aviation sector had handled more than 10 crore passengers prior to the pandemic, which dropped to 6.3 crores in 2020, and 8.38 crores in 2021.

This upward trend is putting pressure on airlines, airports and the allied industries. While airlines are able to ramp up with aircraft, the investment required in terms of retraining cabin and cockpit crew adds up to a considerable investment. Bringing aircraft back into service from parked and stored positions is proving to be a challenge. . 

The Director General of Civil Aviation recently restricted 90 pilots from SpiceJet from flying the B737 Max aircraft after noticing gaps in their training programmes. The facility at Noida, outside of Delhi where the pilots were training had faulty equipment, which the regulator noticed and ordered an immediate freeze on training at the facility. The pilots have to retrain successfully to fly the aircraft safely, the aviation regulator said. Spicejet in its communiqué said the restriction would not affect its current operations, but raises an important question on the rising demand, which the Indian Flying Training schools are unable to meet immediately. 

Currently over 400 pilots pass out every year in India, given the demand of nearly 1000 pilots on an annual basis the gap keeps getting wider. The permissions for new Flying schools may help; nevertheless, the most severe battle remains the demand to meet the shortage.

The challenge of cockpit crew is being reflected in the industry globally. The US faces an acute shortage of pilots which results in flights being cancelled at short notice and the country is looking at enhancing the retirement age from 65 years to 67 years to manage the crisis. Some airlines are looking at being flexible on entry-level experience of pilots to shore up strength. 

Even in India, several airlines are coming forward with re-training schedules to ensure that the pilots are able to achieve the qualification at a quicker speed. To quote a pilot who recently commented on staff shortages said, “Several of us were laid off for long gaps, and now it is a challenge to retrain and expect us to fast forward, it is difficult and proves to be nerve racking, safety on any aspect is not up for a compromise in our industry.”

Similar shortages are also being seen in other departments, especially ground handling. The incident on 16 May at Bengaluru’s KIAL raised an alarm. Passengers arriving by an Indigo flight were left waiting at the tarmac for over 20 minutes, as the ground staff could not muster buses to take them to the terminal. After the issue went viral on social media, an enquiry was ordered. 

Industry experts feel that the rapid expansion and restoration of several routes in the summer schedule is adding to the pressure of recruitment. The industry is yet to see matching recruitment by airlines and airports of the ground handling staffers. Given the security and safety concerns, the situation is dangerous. Ayesha Rukhsana, a staffing and training consultant based out of Bengaluru says, “Getting young ground and terminal staffers is a challenge, but it becomes a bigger challenge when they are asked to move into Tier 2, Tier 3 cities.  A large majority of them are looking at doing a stint in India, thereafter seeking opportunities abroad”

Most Airlines have reported losses for the last two years and are yet to make any big investment in work force and infrastructure. Frequent fliers flag off several concerns, including the lack of human interface. 

A majority of airlines are still on contact less mandatory Web Check–In format, arguments and inconvenience to passengers are common sights at the terminals. Some of the airlines continue to demand INR 200 for an airport check-in. “The objective appears to be that some airlines want to milk out maximum money from the passenger, by charging extra for seats, extra for baggage, extra for check in , etc. etc. There is no focus on giving a passenger a great flying experience like before,” says Subhash Agarwal, a businessman from Bengaluru. “There was a time when airlines like Air India, Jet Airways, and Kingfisher made an effort to make your flights comfortable and had great service standards,” he adds.

While businessmen like Subhash Agarwal may have a point in what they feel and say , the fact is the airline business in India has now moved beyond being a metro phenomenon, and short haul flights to smaller towns now account for over 60% of flights in India. As per the DGCA’s domestic city pairwise data, the share of the top 10 routes has dropped by around 9% in six years from around 30% in 2016 to 21% last year. Contributing to nearly 46% in 2016, the share of passenger traffic in the top-20 routes dropped to 33% last year. 

Most of the airlines in India are looking away from the crowded metro routes, which are very price sensitive and competitive. The total number of routes operational in India now stands at 567, compared to 410 three years ago. With better revenue per seat, airlines are eyeing newer destinations and routes. For example, a Delhi-Mumbai ticket hovers between INR 5000 to 6000 on most days, while a Delhi Pune is between INR 6000 to 8000. Smaller stations are able to give better revenues in many cases and it works better for most airlines to be on some niche routes.

It is not just the domestic airlines; even international airlines are looking at flying into India beyond the four major cities Delhi, Mumbai, Chennai and Bengaluru. Ethiopian Airlines which started flying to Delhi from capital city Addis Ababa in 1966 and later started services to Mumbai in 1971 added Bengaluru to its network in 2019 and are now set to add Chennai to the list of destinations served in India. Other destinations such as Ahmedabad and Hyderabad are also on the airline’s radar.

Qantas also recently announced its plans to launch a Bengaluru-Sydney direct flight starting September 2022. 

However, the rising cost of fuel is a threat to the bottom line. The 10th consecutive ATF price hike this year has sent the fuel prices skyrocketing to an all-time high. Aviation is no longer a luxury but an essential infrastructure need which keeps the nation moving and with some tail winds it is hoped that ATF prices will be reduced giving this cash starved sector some respite and a fair chance to grow. 


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