IndiGo at 300 – a silver lining in a country dotted with aviation failures
The induction of the airline’s 300th aircraft is just one of its achievements since starting out over 16 years ago.
IndiGo, India’s largest carrier by fleet size, domestic market share and international departures, has reached another milestone. It inducted its 300th active aircraft – a first for any airline in the country.
For a country dotted with failures in aviation, both small and large, this comes as an achievement like no other.
How it started
IndiGo started operations in August 2006. The total fleet size in India in 2006-07 was almost the same as the number of planes that IndiGo has today. There were 305 aircraft across all scheduled airlines in India at the end of 2006-07, which itself was a growth of 25.5 percent over the previous year. IndiGo had only eight aircraft in March 2007.
The IndiGo of today has crossed just about every parameter of the industry of 2006-07. At that time, the Indian aviation industry operated an average of 1,321 domestic departures and carried an average of 118,778 domestic passengers daily. IndiGo operated 1,446 daily domestic departures and ferried an average of 216,697 passengers daily in November, the latest period for which data is available.
Only Air India, Alliance Air, Air India Express, Go FIRST (then Go Air) and SpiceJet continue to operate today. The other airlines that existed when IndiGo started were Air Deccan, which merged with Kingfisher Airlines and went down in 2012; Air Sahara, which merged with Jet Airways and failed in 2019, and Paramount Airways and Indian Airlines, which merged with Air India.
IndiGo ended 2006-07 with a 2.6 percent market share, while Jet Airways led the market with 27.7 percent, followed by Air Deccan at 18.58 percent.
How it’s going
Sixteen years later, the story has flipped. IndiGo is not just the market leader, it has over half of a market that itself has grown manifold. The domination on domestic routes is complete, yet evolving. The expanse across the length and breadth of the country along with multiple frequencies and connections have made it a beast that hardly any airline has managed in this country.
In the process, the airline has focused on moving to the newer generation of aircraft – the A320neo family, which not only helps with 15 percent savings but is also cleaner for the environment.
However, the airline is now at the receiving end of taunts that others faced. From a single fleet model known for its simplicity to a multi-fleet type – including a wet-leased widebody aircraft soon – the airline has inched towards becoming a value carrier. So far, it has worked due to the lack of competition, but this could well change after 2024, when Air India consolidates its offerings.
200 to 300 took longer than 100 to 200
IndiGo had an active fleet of 100 A320ceo aircraft at the end of Q3 of FY16. This was the last quarter of a single fleet type for the airline. It started inducting the A320neo after that and from Q3 of FY18, the airline also brought in the ATR 72-600.
In Q3 of FY19, the first A321neo entered IndiGo’s fleet. In the same quarter, the airline crossed the mark of 200 planes. While the journey from 100 to 200 planes took 12 quarters, the journey from 200 to 300 took 16 quarters, a year more.
This was because the airline was not only growing, it was also replacing planes. It effectively inducted over 200 planes in this period – 100 as replacements and another 100 as additions to the fleet.
What next?
If there is one common thing that binds the airlines of 2006-07 and those of today, it is losses. Airline expenses were higher than income back then and so are they now. The industry in India had recorded a loss of Rs 4,707.22 crore in 2006-07. IndiGo alone posted a loss of Rs 2,648.75 crore in the past two quarters.
IndiGo has benefitted marginally with the periodic failures of rivals. While the biggies faltered during the economic crisis of 2008-09, IndiGo remained relatively unscathed because it was small. Kingfisher folded in 2012. This was followed by a near-collapse of SpiceJet in 2014 and the failure of Jet Airways in 2019.
With the market expected to change rapidly and pressure from oil prices and the rupee unlikely to change in the immediate future, how the airline charts its path is also dependent on supply chain issues with manufacturers.
Will it move to change LOPA (Layout of Passenger Amenities) to have a small business class cabin? Will the airline decide to have ovens on its aircraft? The next 100 planes and two years will have a lot more answers than ever before.
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