India’s civil aviation sector is in its “golden age” and there is also a healthy competition among domestic carriers, said IndiGo CEO Ronojoy Dutta. The comment from the chief of India’s largest carrier comes at time when IndiGo and its rival carrier SpiceJet posted massive losses in the quarter ending September, and aviation sector in general experiencing lower growth in traffic.
“We are in the golden age of the Indian aviation and there are huge opportunities going forward ... There are always problems, there are always issues and economic cycles. (But) The fundamentals are strong,” he told news agency PTI.
According to latest Directorate General of Civil Aviationdata, the traffic grew just 1.18 per cent in September and there is softness in fares, which shot up drastically post the collapse of Jet Airways, in recent months. Tax on aviation turbine fuel (ATF) is 30 per cent higher than rest of the world. Bringing ATF under the Goods and Services Tax (GST) has been a long pending demand of the airline industry, he said.
IndiGo, which had a market share of 48.2 per cent in September, reported higher thanexpected losses of Rs 1,062 crore in the July-September quarter, up 63 per cent year-on-year due to higher expenses.
Despite the headwind, IndiGo has a very aggressive expansion plan. It has started 11 overseas routes in last one year and placed an order for 300 more planes from Airbus. It is also considering wide-body aircraft for long haul routes and entered into an codeshare pact with Qatar Airways.
On whether there is healthy competition among local carriers, Dutta replied in the affirmative. “We have a commonality of interests. Airlines around the world have commonality (of interests). It extends to ATF taxes, infrastructure issues. In terms of who gets which rights and who flies where, it is all fierce competition,” he noted.
Dutta also made it clear that there are no plans for a loyalty programme for passengers.