Indian domestic airlines carried 1.53 crore passengers in May, a 9.49% year-on-year increase. While IndiGo retains the largest market share at 64.9%, the Air India Group is steadily expanding its presence. The data also highlights operational costs related to flight delays and cancellations.
Domestic air travel in India showed strong momentum in May, with airlines transporting 1.53 crore passengers. This marks a 9.49% increase compared to the same month last year and reflects continued recovery in demand from the 1.38 crore passengers recorded in April.
Market Share and Operational Performance
IndiGo remains the market leader, commanding a 64.9% share of the domestic market. However, the Air India Group has been steadily gaining ground, reaching a 25.6% market share. Smaller players also continue to navigate a competitive environment, with Akasa Air maintaining a 5.8% share, while SpiceJet’s market share stood at 2.5% for the month.
Operational reliability is a key metric for investors, as on-time performance (OTP) often correlates with operational efficiency and customer retention. In May, IndiGo recorded an OTP of 82.8% at major airports, followed by Akasa Air at 78.3% and the Air India Group at 74.5%. SpiceJet reported significantly lower operational reliability, with an OTP of 26.5%.
Impact of Delays on Airline Financials
While passenger volume growth is a positive signal for the sector, airlines face ongoing financial pressure from flight disruptions. According to data from the Directorate General of Civil Aviation, the industry-wide flight cancellation rate was 0.55% in May. These disruptions carry direct financial consequences for carriers.
In May, flight cancellations impacted over 63,000 passengers, requiring airlines to pay approximately Rs 70.32 lakh in compensation and facilities. Furthermore, flight delays affected more than 1.77 lakh passengers, resulting in nearly Rs 4.24 crore in facilitation costs. Additionally, incidents where passengers were denied boarding led to nearly Rs 98.60 lakh in compensation payouts. These costs represent an unavoidable expense for airlines, and investors often monitor whether rising traffic volumes can sufficiently offset these operational and compensation-related outflows.
Moving forward, the primary monitorable for the sector remains whether airlines can sustain high passenger load factors and pricing power while managing the rising costs associated with operational delays and fuel prices. Investors will also track how the Air India Group’s ongoing fleet expansion and service improvements influence the competitive balance in the coming quarters.