Most of the planes will be introduced by market leader IndiGo and Air India, which is set for its fastest annual fleet addition as the Tata Group presses forward with its revival plan for the privatised carrier. Still, airline executives said all these new planes won’t be enough to cater to the growing demand, keeping fares firm and likely leading to a profitable year for the industry.
“The travel demand will continue to be robust this year,” said Aditya Agarwal, CFO at online booking platform Cleartrip. “There has been a 12.5% increase in domestic travel and a 13% increase in international travel.”
‘India Becoming a Travel Powerhouse’
“The industry will continue to witness unprecedented growth, surpassing pre-pandemic levels in gross booking value across major sectors,” he said.
The Air India group will add around 70 aircraft this year with most of them for low-cost subsidiary Air India Express. CEO Aloke Singh said that the carrier will add 50 Boeing 737 Max planes in 12 months for a total 98 aircraft as it will phase out 14. A majority of them will arrive in the April-June period, said people with knowledge of the matter. The carrier has asked pilots not to apply for leave during those three months, according to an internal communication reviewed by ET.Air India Express will be deploying most of the planes on domestic routes as it gears up to compete with IndiGo. Air India is going to add another 22 aircraft, out of which 10 will be wide-body planes for long-haul overseas routes.”With international journeys poised to triple by 2030, strong domestic demand and new airports coming up, India is becoming a travel powerhouse,” Air India CEO Campbell Wilson said. “Air India is preparing to meet this demand head-on. Our record-setting 470 aircraft order is now leading to the arrival of one new aircraft every six days throughout 2024, unlocking opportunities.”
Vistara will add three more aircraft for a total 70 by the middle of this year.
IndiGo is planning to add up to 60 aircraft this year with a new induction every week. On the other hand, the airline is grounding about 80 aircraft until February-end to fix snags with their Pratt & Whitney engines.
“In net terms, there will still be an addition to our total fleet size as bulk of the planned groundings have already been done,” said an executive of the carrier. “There will be an addition of four to five aircraft every month.”
Also, the airline will take about a dozen planes on short-term leases to counter the impact of the grounding.
Akasa Air, which is gearing up for international expansion, will add around 16 aircraft this year, taking its fleet size to 38 from 22. While the airline had been forced to cut flights due to a pilot shortage, it is resuming expansion and will soon have a base in Delhi, India’s largest airport, said people with knowledge of the matter.
Industry executives said even such unprecedented growth is unlikely to lead to a fare war. “Along with growth, there is a significant number of aircraft which will be grounded,” said an executive who heads sales for an airline. “Airlines will phase out some aircraft. I don’t expect a situation where airlines will have to do a fare war as the supply will not be enough to cater to the demand.”
