FPJ Analysis: Air Turbulence Ebbs In A Cloudy Sector

FPJ Analysis: Air Turbulence Ebbs In A Cloudy Sector

IndiGo and the Tata group's airlines dominated nearly 90% of the domestic aviation market in the Jan-Mar quarter, effectively creating a duopoly situation.

Srinath SridharanUpdated: Friday, May 10, 2024, 10:19 AM IST
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Air India Express Crisis | Representative Image

There is some respite for Air India Express with a section of the cabin crew deciding to withdraw the strike and resume duty after the airline promised to look into all issues. It is understood the airline has agreed to reinstate all sacked cabin crew members with immediate effect.

A day after nearly 300 employees proceeded on mass sick leave and switched off their phones, the airline had decided to terminate the services of at least 30 cabin crew members; it had also issued an ultimatum to employees to return to work or face disciplinary action.

The thaw will come as a relief to passengers, hundreds of whom were left stranded, especially on Wednesday when the sudden cancellations began.

Though the turbulence seems to be over for now, the Air India Express disruption -85 flights were cancelled on Thursday -has turned the spotlight on the persistent HR challenges within the Indian aviation sector reminiscent of the historical labour strikes a few decades ago.

For an average citizen and a frequent flyer, the cryptic explanation that the management is engaging with the crew to understand the reasons, often translates in pure corporate lingo to "It is a mess, and we hope to make it go away, for now."

The Express hiccup also adds another layer to the recent operational upheaval experienced by the Tata group, with its fullservice carrier Vistara grappling with pilot protests just a month ago, centered on roster and remuneration alterations.

The duopoly of IndiGo and the Tata group's airlines

IndiGo and the Tata group's airlines dominated nearly 90% of the domestic aviation market in the Jan-Mar quarter, effectively creating a duopoly situation. In addition, the premium-class domestic travel is now the monopoly of Tata group. But the ripple effect -- every time an airline has flight issues- results in a significant surge in airfares, and messy delays. As always, in such circumstances, the Ministry of Civil Aviation dispatches a communication to the relevant airline. However, these no longer pacify the passengers and soothe frayed tempers.

In the climax scene of Hindi movies in 70s and 80s, it was a familiar trope for the villain to relentlessly pummel the hero, only for the latter to have a sudden rush of adrenalin, leading to triumph. Just as victory seemed assured, police vehicles would arrive with sirens blaring.

Today, the delayed actions of aviation regulators such as the DGCA or the ministry evoke memories of those cinematic moments. Mere boasts about the construction of modern airports has little relevance. If airlines fail to elicit passenger trust, the overarching policy objective of fostering multimodal transportation connectivity will be in jeopardy. The disruptions afflicting India's aviation sector are incompatible with its lofty aspirations.

Dearth of investment in human capital

Meeting the demand for new planes bought by airlines in India will necessitate an additional 41,000 pilots and 47,000 technical staff. Regrettably, the current dearth of investment in human capital, particularly in pilot training, presents a larger worry. Operational disruptions, exemplified by the grounding of nearly 150 aircraft last year due to supply chain and maintenance issues, add to the operational challenges.

On one hand, there exists a severe scarcity of trained and experienced pilots, while on the other, a considerable number of licensed but inadequately rating-skilled pilots populate the roster. Domestic flight training academies frequently struggle to meet the demand for experienced and type-rated pilots for the influx of new aircraft requisitioned by aviation companies. It raises questions about airlines' inertia in investing in large number of trainer aircraft and training simulators.

This shortage is exacerbated by workforce management issues and discontent over HR policies, as evidenced by recent protests. Given the increasing demand for pilots in the Indian aviation sector, the government may consider pilot availability, operational record and passenger feedback ratings as a licensing renewal condition, annually.

However, the industry's struggle with fogrelated delays highlights a tragic-comedy aspect. The airports' lack of investment, in advanced equipment for zero-visibility operations, points to the crucial gap in privatization. Airport companies seem inclined to invest in ancillary real estate rather than core aviation infrastructure.

Moreover, addressing low visibility requires specialised pilot training, which airlines have to invest in. Apathy about stakeholders seems evident in the actions of aviation owners, who seemingly prioritise acquisition of landing slots and purchasing aircraft, often with extravagant fanfare. Industry experts note that each aircraft purchase could potentially yield additional financial perks or cash-back incentives, both offshore and off the purchaser's balance sheet.

As of now, Indian aviation is where the sky is the limit, but the fog is real, the runways are shorter than a budget flight's legroom, and fares are higher than the permitted flying altitude. Except the owners, everyone is unhappy.

The author is a policy researcher & corporate advisor.

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