Wednesday, December 22, 2010

Airlines set to take off after turbulence

The year 2010 was each a year that saw a silver lining in addition to dark clouds within the aviation industry. Except Air India, which continues to face difficult times, other airlines started a steady march on the recovery right after the slowdown many years of 2008 and 2009.

What ought to be a huge relief on the Indian aviation authorities could be the fact how the US did not downgrade the Indian safety regulator, Directorate General of Civil Aviation, to sub-Saharan Africa levels. The final nod for the second airport in Mumbai right after a delay of three many years and the opening of new T3 terminal in New Delhi were a large plus for travellers.

But just as very good news was flowing in thick and fast right after 2 many years of gloom, the worst fears of aviation came real with India witnessing 1 of its worst ever air crashes on May possibly 22. Air India Express's flight 812 crashed at Mangalore airport, killing 158 from the 166 men and women on board.

The crash, coming amid fears which started within the troubled 2008-09 that some crises-ridden airlines may perhaps not have even adequate income to maintain their fleet airworthy, led to intense financial surveillance from the carriers. The scrutiny once more revealed that except Air India, most other critical airlines' fortunes were showing changes—thanks to a double-digit growth in domestic air travel.

This is borne by the fact that 2009 saw 445.1 lakh men and women flying inside India. But the January-November 2010 period itself saw that figure getting left behind with 468 lakh men and women flying in India. Considering about 50 lakh men and women fly in December, 2010 may perhaps witness a 16% rise more than 2009. "This growth is likely to be even more pronounced, next year, from the economy searching up. So the large upside for the year 2011 is that most airlines, barring —of course—Air India, could come to be profitable again. But simultaneously the large worry is rising oil prices with crude touching $90 a barrel. This may perhaps force fare hikes and affect air travel growth," mentioned a senior ministry official.

That worry apart, financially airlines are searching to fly to the black. Financially-strained Kingfisher got approval to restructure its mounting debts. The country's second largest low-cost carrier (LCC), SpiceJet, was finally bought more than by a south-based group with deep pockets, signalling the end of income crunch, and it, subsequently, also began overseas flights. Similarly, the largest LCC, IndiGo, is all set to launch an IPO and start international flights next year. In fact, the aviation market came a full circle this year. The sacking of 450-odd Jet Airways cabin crew staffers had signalled the beginning from the global meltdown-induced crisis for Indian airlines in 2008. This year, Jet contacted all its sacked staffers and about half of them have joined back within the past few months.

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