DGCA approves wet lease for domestic carriers to meet festive season demand

Directorate General of Civil Aviation (DGCA) has permitted domestic airlines to prepare their fleets for the expected surge in demand during the festive season by wet leasing aircraft, Financial Express (FE) has reported. Wet leasing refers to an arrangement wherein one airline provides an aircraft along with complete crew, maintenance, and insurance (ACMI) to another airline, which is paid for on the basis per hour operated.

IndiGo and SpiceJet are likely to wet-lease 20 aircraft. While IndiGo will source 11 Airbus A320 aircraft from SmartLynx Airline, SpiceJet will induct nine Boeing 737Max aircraft from Corendon Airlines of Turkey, the FE report said, citing sources.

The expected surge in demand

Given the upcoming festive season, which coincides with the Cricket World Cup, DGCA is of the view that air traffic will go up much more than in previous festival seasons and if carriers are not allowed to wet lease aircraft, the fares will likely go up.

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An IndiGo spokesperson told FE, "With the continuous rise in travel demand, we keep evaluating all possible measures to cater to our customers' needs." Currently, IndiGo operates a fleet of more than 320 aircraft. The carrier operates over 1,900 daily flights.

Speaking on the subject, a SpiceJet official told FE, "This year, unlike the previous year when we had an early Diwali, the festive season aligns perfectly for the airline industry. Significant festivals span across all three months of the upcoming quarter, commencing with Durga Puja and Dusshera in October, followed by Diwali in November, and culminating with Christmas in December."

Industry experts expect a rise of more than 30 per cent in airfares from October to November, compared to the same period last year, the FE report said. Co-founder and group CEO of ixigo Aloke Bajpai told FE that consecutive events and festivals in October and November, which include the Gandhi Jayanti long weekend, Navratri, and Diwali, have increased travel demand. The upcoming ICC World Cup 2023 will also add to the flight traffic, Bajpai said.