IMPROVED OUTLOOK FOR INDIAN CARRIERS
Airlines to lose collective US$550m-US$700m for FY2020 from estimated US$1.7b loss in FY2019, says CAPA India
INDIA’S airlines are poised to cut their cumulative losses by as much as two-thirds in the financial year starting in April due to a more stable oil price, with low-cost carriers returning to profitability, said aviation consultancy Centre for Aviation (CAPA) India yesterday.
Its forecast is for Indian carriers to lose a collective US$550 million to US$700 million (RM2.24 billion to RM2.86 billion) for financial year 2020 (FY2020), against an estimated US$1.7 billion loss for the year ending next month.
“The opportunity exists to create a sustainable, profitable future within one to two years,” said CAPA India chief executive officer Kapil Kaul at its annual conference, here.
A narrowing of losses will ease the pressure on Indian carriers in financing the Airbus SE and Boeing Co jets they have on order.
Domestic air traffic was forecast to rise by 14 to 16 per cent in financial year 2020, said CAPA India, with international traffic set to be 10 to 12 per cent higher as the Indian fleet expands by more than 90 aircraft.
But fares are on the rise, with low-cost carriers IndiGo and SpiceJet Ltd reporting higher yields and swinging to net profits in the quarter ended December 31 after losses earlier in the financial year.
Budget carriers, which included IndiGo, SpiceJet, AirAsia India and GoAir, were expected to post a combined profit of US$100 million to US$150 million next year, whereas full-service carriers Air India, Jet Airways Ltd and Vistara would rack up US$700 million to US$800 million of combined losses, said CAPA India yesterday.