Again & Again

Air India’s business decisions are its prerogative. But another pilot strike shows poor management

India’s aviation sector is in a strange place. Airfares are soaring and profitability is high, but passengers are increasingly frustrated. Yesterday, it was the turn of Air India Express to be confronted by irate passengers. Over 80 flights were cancelled after cabin crew went on mass sick leave, a euphemism for industrial action.

Merger blues | AI Express is part of the Tata group’s aviation business. It’s the second time since April that an airline in the group inconvenienced passengers because of internal turmoil. The Tata group is in the midst of merging different airlines in its portfolio. That’s a business decision, and it’s the group’s prerogative. However, when the fallout of the decision affects passengers, it reflects poorly on the way the process is being managed.

No slack available | India’s aviation market is today characterised by tightness. The post-Covid recovery in passenger traffic is being serviced by fewer aircraft than the phase before the outbreak of the pandemic. One result of this situation is a sharp increase in airfares. In addition, the tight market means that mass cancellations like that of AI Express flights result in great hardship for passengers. AI Express operates on international routes in addition to domestic ones. The mass cancellation has had a particularly harsh impact on passengers booked to fly overseas.

Duopoly overhang | Close to 90% of the domestic aviation market in the Jan-Mar quarter was serviced by IndiGo and the Tata group’s airlines. It’s a market close to being a duopoly, which means that there’s not enough competition. One result of it is that airfares, which are high, are expected to stay that way for a while. Globally, the aviation industry is also experiencing supply constraints because of production problems among companies.

Aviation regulator DGCA needs to nudge airlines to ensure their internal problems don’t cost passengers more.