Revenge travel takes the back seat as airfares soar

livemint.com:

World Cup final, a single-day event. Comparatively, the two days prior to Diwali (which was on 12 November), a pan-India festival, saw just 413,953 and 394,289 passengers, respectively. This month, so far, the average daily air traffic is over 402,000 passengers, compared to 431,000 in November 2019.

DGCA data shows that passenger load factor (PLF, or seats occupied per flight) has declined for at least four major airlines. Let’s take IndiGo, the largest, as a proxy. The market leader’s PLF was lower in October 2023 at 83.3% than in September (84.7%), despite the onset of festivals such as Dussehra.

That is contrary to recent trends. For three successive years—2020, 2021 and 2022—IndiGo’s PLF increased from September to October—81.4% to 82.1%, 73.6% to 78%, and 65.4% to 68.2%, respectively. The primary bugbear this time round: rising airfares.

A big part of this is because Go First, which used to fly about 7% of the domestic market, suspended operations in May. Industry experts also point to factors such as continuing work-from-home policies at several organizations and an inflationary environment as being behind the muted demand growth. “Although several factors including rising airfares, lower capacity deployment, closure of Go First, IndiGo fleet reduction and an overall lower capacity deployment appear to be the cause of this, costs need to be kept in control and airlines must immediately push towards quicker and faster capacity deployment, thereby lowering the net cost per seat," said Mark Martin, founder and chief executive officer of Martin Consulting.