India’s domestic air passenger traffic reached 13.85 million in October 2024, an increase of 6.3% compared to 13.03 million in September, according to a recent report by credit rating agency ICRA. The data also shows a 9.6% year-on-year increase, with October 2024 traffic surpassing pre-COVID levels from October 2019 by 12.8%.
For the fiscal period from April to October 2024, cumulative domestic air passenger traffic totaled 93.2 million, reflecting a 5.9% growth compared to the previous year. International passenger traffic for Indian carriers showed a substantial 16% increase year-on-year in the first half of FY25, reaching 16.26 million.
The report notes that airline capacity in October 2024 rose by 7.6% year-on-year and by 5.2% over the previous month. ICRA’s outlook for the industry remains stable, expecting moderate growth in domestic air travel and a relatively stable cost environment in FY2025. However, the recovery in earnings is projected to be gradual due to the industry’s high fixed costs.
ICRA projects a net loss for the Indian aviation sector between Rs 20-30 billion in FY2025 and FY2026, up from Rs 10 billion in FY2024. This is attributed to anticipated yield pressures as airlines work to keep passenger load factors high despite persistently elevated aviation turbine fuel prices.
The report highlights ongoing supply chain challenges, especially with engine issues on Pratt & Whitney (P&W) engines affecting multiple airlines. Go Airlines (India) Limited grounded half its fleet in FY2024 due to faulty P&W engines, significantly affecting its operations. Similarly, InterGlobe Aviation Limited (IndiGo) had over 70 aircraft grounded as of September 30, impacted by engine issues, including powder metal contamination.
Overall, as of June 30, 2024, approximately 134 aircraft, or 15-17% of the total fleet, were grounded due to engine-related problems, impacting the industry’s available seat kilometers (ASKMs).
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