Domestic air passenger traffic steadily increased with the waning of the second Covid wave starting June 2021. Cut to November 2021, the total passengers carried by the airlines crossed the milestone of 1 crore for the first time since March 2020. Pick-up in adult vaccinations, lower Covid-19 infections, and the festive season proved to be a breather for the airline industry. 

These developments had a positive impact on the passenger load factor (PLF) of major airlines. PLF measures the capacity utilization of an airline based on the passengers it carries. The average PLF for the top five airlines rose to 80.9% in November from 68.3% in July. The PLF figure for November 2020 was 72.6% and for November 2019 was 88.8%. Weak demand from the corporate traveler segment is one of the primary causes why PLF is yet to return to pre-pandemic levels. 

What’s interesting is that Air India reported the highest sequential improvement in PLF from 76% in October 2021 to 82% in November 2021, surpassing Indigo’s PLF by a margin of 150 bps. It will be worthwhile to see how the tide turns for the Maharaja as Tata Sons take over its reigns on January 23, 2022. 

As the airlines return to the state of normalcy in 2022, the spread of the new Covid variant, Omicron, can serve as a potential threat to the recovery hitherto achieved.