Air travel growth dives to one-tenth: Economic slowdown not to blame; here’s the REAL reason

Indian air travel industry seems to be still recovering from the woes created by the grounding of Jet Airways. Suspension of the Naresh Goyal-founded airline continues to cast a long shadow several months later. While major rivals including SpiceJet, IndiGo, Vistara and GoAir moved quickly to fill the void created by Jet Airways, the capacity expansion has not borne desired results and the same is evident in the growth of passenger volume. “This year, India will see single-digit growth in terms of passengers,” Balu Ramachandran, Senior VP, Cleartrip, told Financial Express Online.

“Multiple reports put the expected number between 15-18% as the growth prospect this year. However, what we have seen so far is about 3%. It is because of lesser capacity expansion,” Balu Ramachandran said. There has only been 3% expansion in domestics air travel capacity on-year, which has also limited the growth of the Indian aviation industry, he added. Cleartrip gets about 80% of its sales from air ticket bookings and the rest from hotel bookings in India.