COVID-19 has hurt the Indian economy. An already struggling aviation sector is going to lose a lot more business. It is expected that the domestic air traffic is going to fall to 80 to 90 million passengers only this fiscal year. With this, the delivery of more than 200 planes is also going to be put on hold at the moment. This is because the airlines have a severe cash shortage because of ceased commercial operations due to the ongoing lockdown. It was estimated that around 140 million passengers would be flying this year, but the Indian aviation industry has been turned upside down with the continuing global pandemic.
Airlines Allowed to Take Bookings
The government has allowed the airlines to start accepting flight bookings. Some of the airlines, such as Vistara and AirAsia, has already begun taking bookings. But Air India is going to resume its commercial operations post-April 30, 2020. The only problem that might occur is the extension of the lockdown period. There is no clarity about that from the government for now. If the lockdown is extended, the airlines will have to cancel the bookings falling under the dates of the lockdown and yet again halt their commercial operations.
Airlines Already Cutting Employees Salaries and Allowances
The Indian aviation industry has been hit hard and there is no cash flow for any of the airlines for almost two weeks now. There are still substantial fixed costs for many airlines, and this is adding to the burden of cash crunch. SpiceJet has said that they will be skimming down 30% salary of their top-level employees. At the same time, other airlines such as Vistara, Air India and GoAir have also decided to cut the wages of their employees. Air Deccan has ceased all of its operations and has put its employees on sabbatical without pay. This is a hard time for the Indian aviation industry and government will need to offer a relief package to the airlines to help them stay afloat.
