With more planes grounded, spot airfares may defy gravity

NEW DELHI: Get ready for a sharp rise in spot airfares with an unprecedented high number of Indian carriers' aircraft grounded. Thirteen Boeing 737 Max of SpiceJet were grounded on Tuesday night after India also issued this order after a host of other countries like China, Indonesia, Malaysia, UK, Australia and Singapore, to name a few.

The SpiceJet's Max will have several other grounded planes for company. Struggling-to-survive Jet Airways has over 54 out of its fleet of 119 planes grounded. Jet founder Naresh Goyal has, in fact warned Etihad that the airline may get grounded unless the Abu Dhabi-based carrier pumps in Rs 750 crore in Jet this week.

IndiGo has cancelled 30 flights daily till early April due to pilot shortage. GoAir is also not operating some planes. At least 23 aircraft of Air India, a mix of wide and narrow body, are unable to fly for want of spares and engines. The cash-strapped airline is trying to raise funds to buy engines for these planes. AI hopes to start a direct on Delhi-Los Angeles route if it can buy engines for a grounded Boeing 777. "Kaafi saare zameen par," rued an airline official, while discussing the grounding situation in India.

Fearing the spot fare hike due to sudden crunch, aviation minister Suresh Prabhu Tweeted ate Tuesday night: "Directed (aviation) secretary (P S Kharola) to hold an emergency meeting with all airlines to prepare a contingency plan to avoid inconvenience to passengers. While passenger safety is a zero tolerance issue, efforts are already on to minimise the impact on passenger movement as their convenience is important."
An airline official said: "This is the first time that so many planes are going to be on the ground together. While the rate of growth on year-on-year basis has been slowing down in past few months (meaning for example January 2018 over January 2017), the demand is still robust. The sudden crunch in supply side will inevitably push up spot fares."

According to the International Air Transport Association (IATA), India is currently the second fastest growing domestic air travel market globally. Figures released by it last week showed China and India saw 14.1% and 12.4% more domestic passengers in January 2019 over January 2018, respectively.

"India is one of the most expensive places to run an airline as the cost of jet fuel for domestic flights is among the highest here globally. Then there is a crippling airport infra shortage both in metros like delhi, Mumbai and Bangalore and Tier II cities like Patna and Lucknow. A simple step like rationalising taxes on jet fuel for domestic flights, a demand being raised at least since 2005, would have at least ensures that the well run desi airlines could become desi Lufthansas, Emirates and Singapore Airlines. Instead, Indian airline industry is like an ICU with some patients almost on their last breath and being kept alive on a ventilator," said another airline official.