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Monday, 27 October 2014

Adding capacity too fast? IndiGo fills least number of seats despite being market leader

IndiGo managed to fill the least number of seats on its aircraft despite being the clear market leader in September. Last month saw almost all airlines increase aircraft occupancieis because of the beginning of the festival season. But IndiGo was pipped by SpiceJet, GoAir and even JetLite to have the lowest load factor last month among LCCs.
Only regional airline Air Costa and newbie AirAsia India had less seats occupied across their respective aircraft than IndiGo as far as LCCs go. Is IndiGo adding capacity too fast?
Every third domestic flyer took an IndiGo flight last month and the total number of passengers carried by this airline was almost twice that of SpiceJet. But SpiceJet had the maximum loads across its aircraft. As per data released by DGCA, IndiGo filled 77.9% seats across its aircraft while SpiceJet filled 85.9%, JetLite 82.7% and GoAir 82.3%. Air Costa stood at 76.4% while AirAsia India was at just 68.7%

IndiGo has managed to maintain its grip on market share throughout 2014 but aircraft occupancies have been behind others for several months now. Earlier this week, President Aditya Ghosh was quoted in media reports saying India is an undepenetrated market, after announcing a mega aircraft order.
IndiGo is buying 250 Airbus aircraft, it already has a 180 aircraft order pending - deliveries for which will begin only next year. So by 2026, it will have received 431 more aircraft. As of now, it has a fleet of 83 aircraft. Of the new arrivals, some will be used to replace existing aircraft but by far, IndiGo is looking to own one of the largest fleets in Indian aviation industry. Unless market growth keeps pace with IndiGo's ambitions, it may find the going a bit tough though.
Read news in full 17/10/14 Sindhu Bhattacharya/First Post
Adding capacity too fast? IndiGo fills least number of seats despite being market leader

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