Despite an increase in passengers, Indian airlines struggle to make profit
Despite an increase in passenger traffic after the pandemic restrictions were lifted, the airline industry has not recovered from the losses caused by the pandemic due to rising fuel prices.
The airline industry is stuck between a rock and a hard place. Losses incurred by airlines in India increased during the three COVID-19 waves as the number of passengers decreased dramatically.
Despite the massive reduction in flight operations, aviation companies continued to pay salaries, airport fees, aircraft and engine rentals.
As a result, while their revenues dried up, their expenses remained constant. Movement restrictions were eased to varying degrees between waves, and passenger traffic increased. The number of flyers increased significantly after the Omicron wave ended.
However, the cost of aviation fuel rose as well. As a result of the impact of rising fuel prices on profits, the industry’s recovery from the pandemic has been slowed. As a result, despite an increase in passenger traffic, airline companies continue to suffer.
Their losses increased following the outbreak. Despite the increase in passenger traffic, airlines are still struggling as jet fuel prices skyrocket.
The truth is that the sector has been weakened as a result of a combination of mistakes made by both the private sector and, most importantly, the government.
Companies lobbied as if their lives depended on it, and governments intervened as if their reelections hinged on it. As a result, market forces have been stifled in the sector for decades.
