Future of Aviation Industry

Future of Aviation Industry 

Introduction

Over the last three years, India's civil aviation industry has emerged as one of the country's fastest growing industries. India is widely known as the world's third-largest domestic civil aviation industry. India has become the world's third largest domestic aviation sector, and is expected to overtake UK by 2024 to become the third largest air passenger sector.

Market Size

·      India’s passenger traffic stood at 293.99 million in FY20 (till January 2020) where domestic passenger traffic reached 235.44 million and International passenger reached 58.55 million.
·      In FY20 (till January 2020) domestic freight traffic stood at 1.14 million tonnes, while international freight traffic was at 1.70 million tonnes.
·      India’s domestic and international aircraft movements reached 1.82 million and 0.37 million in FY20 (till January 2020), respectively.
·      To cater to the rising air traffic, the Government of India has been working towards increasing the number of airports. As of March 2019, India has 103 operational airports. India has envisaged increasing the number of operational airports to 190-200 by FY40.
·      Further, the rising demand in the sector has pushed the number of airplanes operating in the sector. As of July 2018, there were nearly 620 aircraft being operated by scheduled airline operators in India. The number of airplanes is expected to grow to 1,100 planes by 2027.

Growth







Problem
·      Air traffic control: : Aviation is multifaceted, but they're all highly focused on health. Control of air traffic is the main challenge for the aviation industry. Therefore, the air traffic controller is supposed to do this job and to ensure passenger safety.
·      Baggage handling: Box and cart packing is one of the labour-intensive aspects of baggage handling operation. The expected sector growth also means more baggage handling and airports are looking for technologies to allow them to do that.
·      Monitoring technology: Monitoring equipment such as videos and microphones to implement a particular work intensity is beginning to change the working atmosphere in most sectors of the aviation. Technology increases performance, reducing costs and in effect improving passenger experience. The challenge, however, is that they do not know which technologies to prioritize which remain a problem and which involve inherent risks.
·      Maintenance: Aircraft Maintenance Engineers are expected to inspect and repair the aircraft to ensure the passengers health. They are highly trained professionals who are responsible for aviation health and maintenance. So, hiring a right one is critical. 


Solution

·      Easing government regulation: While the current Indian government has taken important steps to deregulate the industry, there is significantly more opportunity. Per the current government’s UDAN project, the price of half the seats on flights less than 500 kilometers or 1 hour is capped at about $30. While the impact of this price cap is partly offset by concessions such as no landing or parking fees, the low cap makes it hard for airlines to profitably fly those routes. The current regulatory and tax framework that impacts fuel costs puts Indian airlines at a significant disadvantage versus other international carriers.
·      Better airport infrastructure: For the industry, airport facilities and connectivity to and from airports are essential drivers of growth. Though big cities like Mumbai and Delhi have done a decent job upgrading their airports, this is just the beginning.
First of all, these cities can not only be connecting points or feeders for domestic routes, but must instead become real hubs that provide connectivity to different international destination
. Secondly, secondary airports are considerably required as larger airports exceed capacity. Most major global cities have more than one (often up to four) airports serving various roles such as international hubs, low-cost airports (generally with lower airport taxes) and city airports offering easy access to and from the city centres.
Lastly, to tap into wide pockets of demand, India must invest in more effective communication lines between airports and metro and suburban areas.
·      More partnerships with international carriers: Code shares, revenue-sharing arrangements and membership in the alliance can also help raise demand for Indian carriers. Seamless traveler experiences and rewards, such as easy booking, affordable combinable fares, checked luggage, and acquisition and redemption point loyalty program will be key to success.
·       Improved management and operations: Even if the macro conditions are good, Indian carriers won't succeed unless they're operating tight ships. Of course, a solid activity – a comprehensive plan for fuel hedging, streamlined flight and airport operations, and well-managed corporate functions – is important. But it is equally important to have good commercial functions and a high degree of focus on revenue generation. To deliver good and sustainable revenue efficiency, airlines will continue to invest in network planning, revenue management, loyalty programs, marketing, sales and go-to-market strategy, and e-commerce.
Future

India's aviation industry is largely untapped with tremendous growth opportunities, provided that air travel is still costly to most of the country's population, almost 40% of whom are the upwardly mobile middle class.
The industry will engage and collaborate with policy makers to adopt effective and sensible decisions to improve India's civil aviation. With the right policies and unremitting emphasis on quality, cost and passenger interest, India would be well placed to achieve its dream of being the third-largest aviation market by 2020. Indian travellers’ spending is forecast to hit by 2021. India will need 2,380 new commercial aircraft by 2038, owing to rising demand in Air Travel.


Medha Bahukhandi [MBA HR]
Asst Manager HR
AirCrews Aviation Pvt Ltd
medhabahukhandi@aircrewsaviation.com





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