The Indian aviation industry has witnessed a continued recovery in domestic passenger traffic in November 2020, with a sequential growth (over October 2020) of ~19% to ~62 lakh passengers. The capacity deployment in November 2020 at ~59% (vis-a-vis November 2019) is a significant increase over the ~46% capacity deployed in September 2020 and ~52% capacity deployed in October 2020. On a YoY basis, however, domestic passenger traffic declined by ~52%.
According to Ms. Kinjal Shah, Vice President, ICRA: “The number of flights departing has also gradually increased from 416 on Day 1 to 2,065 on Day 198 (December 07, 2020). For November 2020, the average daily departures were ~1,806, significantly lower than the average daily departures of 3,080 in November 2019, though better than ~1,574 in October 2020. The average number of passengers per flight during November 2020 was 115, as against an average of 140 passengers per flight in November 2019. Thus, it is expected that the domestic aviation industry operated at a passenger load factor (PLF) of ~74% in November 2020, against 89.6% in November 2019, that too on a low capacity. The PLF for November 2020 was higher than the 69.1% in October 2020, despite the increase in capacity deployment by ~11%. Overall, from May 25, 2020, till November 30, 2020, domestic passenger traffic has been pegged at ~22.7 million.”
The Ministry of Civil Aviation (MoCA) permitted increasing the capacity to 45%, with effect from June 27, 2020; post the initial recommencement of operations of the scheduled domestic flights, with effect from May 25, 2020, to a limited extent i.e. maximum 1/3rd of their respective approved capacity of the Summer Schedule 2020. It further permitted increasing the capacity to 60% with effect from September 02, 2020, to 70% with effect from November 11, 2020, and further to 80% with effect from December 03, 2020.
While the scheduled international operations are yet to start, the MoCA has permitted international operations under the Vande Bharat Mission (VBM) and Air Transport Bubbles (ATB). Under the VBM for the evacuation of Indian citizens from foreign countries, which started from May 07, 2020, the international passenger traffic (inbound and outbound) for Indian carriers has been ~14 lakh for the period May 07, 2020, to November 30, 2020. For November 2020, international passenger traffic for Indian carriers was recorded at ~3.6 lakh, a YoY decline of ~83%. However, it improved sequentially by ~41%.
As for aviation turbine fuel (ATF) prices, following the pandemic, crude oil prices declined materially – reached a low of ~US$19/ barrel in April 2020, thereby leading to a decline in ATF prices. However, the crude oil prices have increased gradually since then and currently ranges at around US$49/ barrel. Consequently, the ATF prices increased sequentially by 24.1% in July 2020 and by 4.2% in August 2020. However, it declined sequentially by 3.4% in September 2020 and by 5.6% in October 2020, before increasing by 4.6% in November 2020 and by 9.1% in December 2020. However, the December 2020 prices are still lower by 27.1% on a YoY basis. The prolonged shutdown of manufacturing activities in several countries and the subsequent impact of the pandemic on the global economic activity will keep the crude oil prices and thus the ATF prices low.
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