Indian Aviation Industry

 Airlines in India play an important role in boosting the economy. 

The flight travel in India is too expensive with passenger cost which is common along with grounding charges, tickets and foods 

Safe air travel is still not guaranteed for passengers. An Air India pilot fell asleep due to fatigue and the controller alarmed the pilot. This could have led to the loss of lives of  several innocent people. 

There is also uncertainty such as fog which could cause delays while the passengers are unaware of the reasons.

There are problems of delay which only now are being addressed well with refund and compensation.

From an investor perspective, just the cost of a  plane itself is very expensive.

The government interference adds to the burden of air travel. 

There are several small airlines that gets easily bankrupt due to high fuel and tax. 

The Kingfisher went bankrupt due to not paying the bills and taking heavy loans. Vijay Mallya bought several small airlines and could not pay back. This caused legal troubles and he left the country.

Jet Airways had an efficient service quality and operational efficiency attracting domestic and international travelers . Despite its initial success, the airline became bankrupt. This was due to the emergence of low cost airways such as Indigo and SpiceJet which intensified competition. There was also debt burden caused due to fuel prices and taxes. It failed to adapt to the changing market dynamics to offer service to business travelers and the high-end clients.

Indigo’s recent problems center on cancellations and failing to adapt to new and stricter policies. The technical glitches also damaged its punctuality reputation. IndiGo also admitted to planning gaps and misjudged pilot availability.

The future of Indian aviation is shaped towards the duopoly  of Indigo and Tata controlling 90% of the market. If any of the airlines has a problem, the entire country’s economy suffers. There are also  risks caused by  price sensitivity and squeeze of profit during economic shocks.

The government and regulators must enforce rules consistently .There is a  systemic risk of a single carrier failure impacting the entire Indian economy. The government must ensure competition and encourage the entry of more new  carriers into the aviation industry.