Air passenger traffic grows by 26% sequentially in August: Icra

Air passenger traffic in the country logged a 26 per cent month-on-month growth at 26 lakh passengers in August with airlines scaling up capacity by 27 per cent over July, rating agency Icra said on Monday.

Passenger traffic on year-on-year basis, however, plunged by 77 per cent in August, Icra said.

Overall, passenger traffic grew by 19 per cent till August 31, with carriers flying over 70 lakh passengers during the period, after the resumption of services in a graded manner on domestic routes from May 25 following a two-month hiatus.

The capacity deployment at around 33 per cent year-on-year was rather a slow uptick despite recommencement of operations over three months ago, it said.

"The number of flights departing has also gradually increased from 416 on Day 1 to 1,156 on Day 101 (September 2 ). For August, the average daily departures was around 930, significantly lower than the average daily departures of 2,846 in August 2019, though better than 780 in July 2020," said Kinjal Shah, Vice-President, Icra.

The average number of passengers per flight during August was 98 against the average of 133 passengers per flight in August last year, she said, adding it is expected that the domestic aviation industry operated at a passenger load factor (PLF) of around 63 per cent in the previous month as against 85.1 per cent in August 2019, that too on very low capacity.

The PLF for August 2020 has sequentially improved from around 55 per cent in July this year despite the increase in capacity deployment by around 19 per cent, she added.

While the scheduled international operations are yet to start, the civil aviation ministry 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 shores, which started from May 7, the international passenger traffic (inbound and outbound) has been 632,741 for the period May 7 to August 31, according to the rating agency.

For August, the number of international passenger traffic was 2,16,666, a Y-o-Y decline of 89 per cent, it said.

As for aviation turbine fuel (ATF) prices, following the pandemic outbreak, crude oil prices declined materially – reached a low of around USD 19 per barrel in April, thereby leading to a decline in ATF prices.

However, the crude oil prices have increased gradually since then, and currently range around USD 44 per barrel, Icra said.

Consequently, ATF prices increased sequentially by 24.1 per cent in July and by 4.2 per cent in August. However, it declined sequentially by 3.4 per cent in September, which is also lower by 32.3 per cent on a Y-o-Y basis.

“The prolonged shutdown of manufacturing activities in several countries and the subsequent impact of the outbreak on the global economic activity will keep the crude oil prices and thus the ATF prices low," she added.