From Bangkok to Paris, cuts everywhere: What’s behind India’s shrinking global air connectivity 

May is typically a high season for airlines in India and for foreign airlines. Well timed with school and college holidays, many Indians plan their foreign escape timed with extreme heat weeks in India. However, in a not-so-surprising move, even as some European carriers added flights to India, there is an overall reduction in international flights from India. 

Data shared by Cirium, an aviation analytics company, shows that airlines will operate 81 fewer international flights in May as compared to April.

This does not include the flight reductions to the GCC (Gulf Cooperation Council) region, where flight operations remain fluid and uncertain in current times, with April being a near washout for operations with IndiGo pulling out of many airports on a temporary basis, while the Air India group is being selective with operations based on security clearances, traffic and availability of airport infrastructure.

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 Comparison for May shows that a total of 134 flights are being reduced, while 53 are being added, with a net reduction of 81 weekly flights, without considering the gulf operations of Indian as well as carriers from the gulf region. 

 Southeast Asian surprise

In the initial days of the war, there was a sudden shift in traffic to Southeast Asia, away from the war, safe and welcoming. However, things are taking a downturn there too as airlines battle extremely high oil prices and holidays become expensive due to a depreciating rupee. A total of 40 flights will be lost between India and Thailand in May.

The reduction is led by Air India Express, which will reduce 15 flights. This includes reduction in frequency to Bangkok from Pune and Bengaluru, reduction of flights to Phuket from Hyderabad, and temporary cancellation of flights to Bangkok from Surat. Thai AirAsia is also pulling out of Jaipur and Guwahati, where it operates from Bangkok Don Muong, while Thai Lion Air reduces a frequency each to Chennai, Delhi, Kochi, Bengaluru and Ahmedabad. Thai Airways will halve the flights to Mumbai and reduce frequency to Hyderabad.

Singapore also sees a sharp reduction, with the Air India group reducing 26 weekly flights, followed by Scoot and IndiGo, which are reducing only two frequencies a week. Flights to Kuala Lumpur will also see a reduction with 20 frequencies lower in May, led by AirAsia, which is pulling out of Lucknow and Kozhikode. Some airlines have reduced frequency by one day a week, and this includes flights to Almaty, Tashkent, and Ho Chi Minh City, amongst others.  

Expensive holidays to blame?

Rupee has depreciated 10.4 per cent to a dollar in the last year. Passengers have to spend 10 per cent more for a dollar. The other currencies have not been any different. The Singapore Dollar is 13.25 per cent more expensive today than it was a year ago; the Thai Baht is 14.5 per cent more expensive year on year, and the Malaysian Ringgit is 21 per cent more expensive than the rupee. Holidays to South East Asia are expensive even without factoring in the inflation numbers. 

The higher cost of Aviation Turbine Fuel (ATF) would make some flights unviable to operate since they cannot attract passengers at very high fares. Some of the countries are also facing shortages of ATF which then prompts the airline to select the most profitable or least loss-making network to ensure that limited and scarce resources like ATF are well utilised.

Major reduction by Air India

Apart from reducing seven flights a week each from Chennai, Mumbai and Delhi to Singapore, Air India is also reducing flights on its long-haul network. Double daily flights to Paris will be cut to 10 weekly, while three flights a week will be cut to San Francisco and Toronto. The airline will also cut twice-a-week flights to Vancouver, Rome, Sydney and Melbourne. Zurich, Shanghai and Copenhagen will see a reduction of one flight a week.

Who is adding flights then?

There are 53 weekly additions happening in May, with 18 of them being to Colombo, added by Sri Lankan Airlines. This again is an indicator of the changing tourism pattern, and passengers look for options even closer and cheaper. For context, the Sri Lankan rupee has largely remained flat to the INR over the last year while depreciating even more than the INR against the dollar. 

Some of the flights that are getting added are those to Kuala Lumpur and Bangkok by local rivals of airlines that are currently pulling out. The instant availability of rights along with the government allotting them to local carriers is helping fill up this capacity for a short span. 

What happens next?

Historically, most airlines have braved the tough times and wrapped up after things normalised. A precedent here is the last oil crisis of 2008-9, when airlines faced severe headwinds, but the collapse in India happened in 2012 with Kingfisher wrapping up after shrinking until then. Air India and IndiGo are backed by strong groups but will still have to find ways to sustain the high-cost environment. 

IndiGo has so far held on to its network, and most carriers have added capacity in domestic skies for the peak month of May. The domestic ATF prices have been regulated as a special arrangement starting early April since the market rate nearly doubled due to the West Asia war.

Without a breakthrough in the Hormuz, the carriers will find it difficult to get as many passengers at fares that are justifiable for viable operations. Each passing day will make the promoters question how long they can hold on before another surge of cancellation hits the schedules.