Domestic Air Passenger Traffic Grows by 5.45% in September 2021

If Aug-21 seemed like a good month with over 67 lakh passenger flying domestically, Sep-21 has done even better. The Sep-21 figure was higher than the August figure by 5.45% at 70.66 lakh passengers. These numbers were reported by the Directorate General of Civil Aviation (DGCA), which puts out monthly passenger traffic numbers.

On a YoY basis, the passenger traffic for Sep-21 was up by 79%, but that may be a tad misleading as the corresponding month of Sep-20 was an exceptionally tepid month wherein the flying percentage was much lower. In September, flights were allowed to operate at 85% of pre-COVID capacity as compared to just 72.5% in Aug-21.

There have been a number of factors for this surge in passenger traffic, apart from the higher flying ratios permitted and the higher PLF. One reason was the pent-up demand or the revenge spending as it is called. Also, the festival travel has shown a surge in the month of September and flying for non-business purposes was quite robust in Sep-21.

If you consider the 9 months period between Jan-21 and Sep-21, then the total passengers ferried stood at 531 lakhs. This is about 20.5% higher than the passenger traffic in the first 9 months of year 2020. Again, this is not strictly comparable since the period between March 2020 and May 2020 was a virtual aviation washout due to flying restrictions.

It may be recollected that in Jun-21, the flights were forced to reduce the flying to just 50% of pre-COVID capacity to limit the spread of COVID 2.0. However, that has now been raised to 100% in October. That should result in the PLF or passenger load factors getting back to the 85% plus levels, which is where airlines can once again hope to return to profitability.

Check - Ministry of Civil Aviation allows Airline Companies to Fly with 85% Capacity

The overall aviation industry is likely to benefit from this demand surge. For Sep-21, Indigo Airlines had a commanding market share of 56.2% while Air India, Go Air, Spice Jet and Vistara all had market share of 8-9% each. Air Asia had a share of around 5.5% in Sep-21. The big challenge for other airlines will now be to take back their market share from Indigo.