Not just pilot shortage: what caused Akasa Air’s August turbulence?

Akasa Air has had a turbulent last 90 days. The airline told the courts that it “may shut down” to its CEO talking about listing plans before the end of the decade. As it looks to put the worst behind ahead of the winter schedule beginning this Sunday, the Directorate General of Civil Aviation declared the granular data for the month of August, when the issue blew up.

An Akasa Air passenger aircraft on the tarmac at Chhatrapati Shivaji International Airport in Mumbai.(Reuters)
An Akasa Air passenger aircraft on the tarmac at Chhatrapati Shivaji International Airport in Mumbai.(Reuters)

From an August to remember for its launch to an August to forget for its cancellations and shrinking of market share, the full circle came in much earlier for Akasa Air. The impact on schedule was 16% when 10% of its pilots left.

Were pilots the only reason?

Aviation circles were abuzz with discussions on the topic. “Can just 43 pilots get the airline to this?” Or is there more than what meets the eye? Why did the pilots leave?

As the courts decide on most of these aspects, flight tracking website FlightRadar24’s data shows that Akasa also had a downtime with its aircraft, with its planes parked at Hyderabad, possibly at GMR’s MRO. The airline later said the planes are undergoing reconfiguration.

Some of its aircraft had come in with dual class configuration due to supply chain issues. The reconfiguration of these would potentially add 15 seats a plane and at an average of 6.8 flights per day, which the airline recorded pre-August. That would mean 102 additional seats a plane every day. With 11 such planes, this translates to 1,122 seats—roughly equal to one whole plane per day without really adding a plane physically.

If all of this has worked well, the only place where the airline erred was probably last minute cancellations and communication to passengers, airports, travel agents, media and the general public. Reputation is hard to build, easy to lose and in the aviation industry can be rebuilt only by dropping fares—which is hazardous for the business.

Numbers don’t lie

The airline operated 3,369 departures in August, 648 lower than July. This translates to 21 fewer flights per day. The airline has been on a consistent growth path in both departures and passengers, until the turbulence in August.

Consider this: the airline operated 79 flights a day in January, which grew to 88 in February. March and April saw an average of 103 and 110 daily departures. The peak months of April, May and June saw 110, 123 and 126 daily departures, with July seeing 129 before dropping to 108—the levels pre-April.

The airline operated 3,369 departures in August, 648 lower than July. (HT graphics)
The airline operated 3,369 departures in August, 648 lower than July. (HT graphics)

The drop in August was a steep 16% in departures over the previous month, which also led to a corresponding drop in passenger numbers and ultimately resulted in a loss of market share. Result? Akasa, which sneaked past SpiceJet in terms of market share, was relegated behind SpiceJet, again.

The capacity by ASK (Available Seat Kilometres) dropped 10% in August, an indication that the airline preferred to operate longer flights than shorter ones. However, passengers were complaining, especially since this was festival season and a considerable number of impacted flights seemed to be from the South – where passengers had booked to travel for Onam.

What next?

The airline has gone in for a major network re-jig as the winter schedule kick-starts. Even as August was troublesome, the airline operated more flights than what it began the season with and a utilisation of over 100% of its allocated slots, with the only other airline doing so being IndiGo.

Some of the routes where it began operations with multiple frequencies like Bengaluru-Kochi, Chennai – Kochi or Bengaluru- Chennai have seen massive reduction in frequency or a total pull-out. This is to cater to additional slots, which were available at Mumbai and Delhi because of GoFirst’s suspension in May.

India has seen market share being a function of capacity share, like most other markets. The much talked about three-digit order could be weeks away for Akasa Air.

With a barrage of capacity being inducted by IndiGo and Air India group, the airline will require a sizable fleet to maintain its current market share. The induction rate will have to be higher than competition to snatch some market share. The airline instead may opt to look at niche international routes.

Domestic routes have challenges with slot availability, for international the challenge doubles up with slot and bilateral rights. Airlines promoters in India have often called their ventures as “marathon” or “sprint”, in reality running an airline in India has always been “steeplechase”

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