'Air traffic vol to fly past 150m in FY19 from 125m this year'

The near 20 per cent volume growth that the domestic aviation market has been witnessing so far this fiscal may continue to next year as well with volumes likely to fly past the 150-million mark in FY19, up from 125 million in FY18, says an industry report.
According to a projection by the Centre for Asia Pacific Aviation (Capa) India, domestic passenger volumes are poised to touch 125 million by this March, growing 18-20 per cent and may clip at the same rate and reach the 150 million-mark by March 2019.
"Domestic air traffic is expected to grow 18-20 per cent and touch 125 million in the year to March 2018. The domestic volume will reach 150 million in March 2019," Capa India head Kapil Kaul said here today.

According to the aviation regulator DGCA data, as many as 117 million passengers flew in calendar year 2017.
The number of international passengers is expected to increase by 12 per cent reaching around 65 million by March 2018 and may touch 75 million by March 2019, he added.
He opined that if the government lifts the bilateral restrictions for international operations, this segment can grow nearly 15 per cent over the next three-five years.

However, Kaul warned that the rapid volume growth may put profitability under pressure.
"Growth may be tempered to 15 per cent if some capacity additions are delayed," he warned, adding the fleet of low-cost carriers may reach 376 aircraft by March 2019.

Indigo alone will spend over USD 500 million in FY2019 to acquire 8-9 A320s and most of its planned ATRs.
About the Air India privatisation, he said bids are likely to be out mid next month and the process may be over by July. He expects two non-aviation companies and four domestic airlines-Jet Airways, IndiGo, Vistara/Tatas and Spicejet to bid for the national carrier.
Meanwhile, addressing the Capa summit here, Ajay Singh, chairman of Spicejet ruled himself out of the race for the national airline saying his airline is "too small" for a large carrier like Air India. He, however said "despite its many problems" the flag carrier "is a good asset" which wouldn't have any dearth of bidders.

On fleet expansion, Capa says the domestic airlines are expected to induct 124-130 aircraft by March 2019, an increase of 25 per cent. Of this, around 22 aircrafts will be utilised for regional connectivity scheme (Udan) and around 25 aircraft are expected to be used for international operations.
On the financial profile of the airlines, he said the next year would look like FY18, with consolidated industry losses of USD 430-460 million, and a prospect of increased losses if fuel exceeds USD 70 a barrel.
Of the total losses, the full service carriers may report losses of USD 900-925 million, while the no-frills ones will book a profit of USD 468-515 million in FY19.

The agency sees the combined industry loss at USD 350-425 million in FY18 primarily due to the estimated compensation of USD 62-87 million received by industry from aircraft makers due to the engine issues.
But led by IndiGo, low-cost carriers are expected to report USD 450-500 million profits including USD 62-87 million compensation on engine issues.
The only exception to this will be AirAsia India which is expected to be profitable in next fiscal.
Full service carriers are projected to report USD 825-850 million losses this fiscal with both Air India and Vistara losing money. Jet Airways is expected to either break-even or report a modest profit, subject to Q4 performance, he said.