Home Flying High Domestic IndiGo: finding opportunities, awaiting favourable tailwinds

IndiGo: finding opportunities, awaiting favourable tailwinds

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IndiGo has been one of the innovative airlines not just in India but also globally. They always find new approaches to combat difficult situations. Like the COVID-induced lockdown posed a challenge for their business but timely powering cargo operations turned out to be an opportunity for the CarGo arm. Moreover, Willy Boulter, Chief Commercial Officer, IndiGo, is quite optimistic of the revival of the aviation sector very soon and this will be due to the travel demand, fuelled by passenger confidence in air travel.

Prashant Nayak

At IndiGo, they witnessed a strong recovery in February 2021 as they achieved 80 per cent of their pre- COVID levels. They have also seen that air traffic is strongly correlated to the number of COVID cases. February was the best-performing month for IndiGo since the pandemic hit, with passenger numbers rising to as high as 180,000 a day. However, they all are aware that the second wave did impact overall traffic, with a rock bottom in mid-May, and the traffic getting better as COVID cases are reducing. Overall, they believe that they will reach the February levels by end of this year and hopefully a full recovery by next year, contingent on the opening of international borders.

“In the domestic front, we had announced opening 7 regional stations to enhance our domestic connectivity. For now, it’s Leh, Agra, Darbhanga, Kurnool, Bareilly, Durgapur and Rajkot. We continuously explore the new markets and opportunities these markets provide for and accordingly decide about adding new destinations and routes,” tells Boulter.

However, the pandemic has given them the opportunity to look at new ways of doing business. They always come up with new ways to combat difficult situations. They entered the crisis with no freighters but deployed around 10 A320/321 passenger aircraft for CarGo operations as their ‘CarGo-in-cabin’ charters. For the fiscal year 2021, their cargo revenue increased by 9.6 per cent as compared to the previous year. This has really supported them during this pandemic period when their operations have been severely impacted.

IndiGo has also initiated a freighter programme and is in the process of sourcing 4 A321CEO aircraft. Boulter shares more, “The A321P2F – Passenger-to-Freighter conversion is the most efficient narrow-bodied freighter available, offering 24 container positions and supporting a payload of up to 27 tonnes. The delivery of our first freighter is expected in the first half of CY2022. Our investment in the Freighter Programme will help strengthen our product and services in the segment, and not only accelerate our own business recovery but will also be a strong engine of economic growth for the country.”

Additionally, to prepare themselves for the upcoming 3rd wave (if at all it arrives), they are building a war chest through Qualified Institutional Placement (QIP). They have recently got approval to raise Rs. 3000 crores through the QIP route, to keep their balance sheet stronger, which now they believe is the need of the hour.

While speaking about the aviation industry losing key job skills and its overall appeal to jobseekers, Boulter says, “It would not be apt to say that the industry would lose its appeal for jobseekers as we are optimistic that once the situation normalises, which definitely will very soon, there will be demand in the industry for varied jobseekers. Aviation as a career has always been fascinating and challenging, which will continue to be the same. Moreover, we are proud of the fact that the aviation industry has been at the forefront when the country needed them, and our employees have worked relentlessly as frontline workers. This makes us optimistic that however challenging the current situation may be, the aviation industry will always be looked upon as one of the ideal careers for many aspirers even in future.”

Going on, there has been a positive response from travellers since IndiGo restarted their flights. The overall travel demand has shown consistent growth owing to returning customer confidence till the 2nd wave had hit them. “The fact is that air travel is the safest mode of travel in times of pandemic. People are travelling for VFR besides essential travel. However, the encouraging aspect right now is that we have seen demand recovering in the month of June. On the back of increasing customer confidence in air travel and steady growth in passenger numbers, we are bullish that demand will further grow with the increase in capacity across our network,” assures Boulter.

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