India's domestic aviation recovery is picking up steam. July saw 61% more passengers take to the skies compared to June, with just over 5 million passengers in total. Airlines also saw marked improvements in their load factors as passengers increased. In response, the government has increased flight capacity by 7.5% but also increased the minimum base fare on all routes.

As expected

Following a catastrophic second wave in April and May, India has seen a steady recovery of domestic passengers since then. From just 3.1 million travelers in June to 5 million in July, airlines are finally seeing strong demand for leisure and VFR (visiting friends and relatives) travel. However, traffic for Q2 was down nearly 40% compared to Q1 of this year.

While this remains far below the 12 million passengers flying monthly pre-COVID, it does mark a recovery closer to February 2021, the strongest month since the pandemic hit. Most airlines have also seen their load factors improve, allowing them to launch new routes and tap into new markets.

This recovery is expected to continue through August, which is already seeing massive numbers of daily passengers. Assuming no further spikes in cases, India could be back to the same levels it saw earlier in the year. However, the only certainty for the aviation industry remains constant uncertainty.

Movement

When it comes to airline market share, there's been some notable movement. Air India's share of domestic travelers continued to slip in July as well, falling from a high of 20.3% in May to 16.5% in June and now 13.4%. However, Air India is not the only airline slipping behind this month.

GoAir's market share fell from 8.3% to just 6.8%, a notable fall for the debt-heavy airline. AirAsia India slipped ever so slightly to 3.3%, while SpiceJet picked up a tiny 0.1% share to end July at 9.1%. Vistara saw an increase in market share from 7.2% to 8.1% in July. However, the biggest winner was undoubtedly IndiGo.

IndiGo's market share rose from 54.7% to 58.6% in July, a huge increase for the already dominant airlines. This came as the airline aggressively added capacity and new routes, helping it bag even more passengers.

Passenger load factors (PLFs) have been rising too. SpiceJet remains number one here with a PLF of 74.6%, a 3.6% increase. GoAir came in second at 67.1%, despite actually falling 3.8% in July. IndiGo was third with a 66.2% PLF, up almost 4%. Vistara saw the biggest jump this month, up 9% to 69.2%.

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Slow, and hopefully steady

While airlines have been keeping busy domestically in July, the lack of international traffic remains a sore spot for many. However, higher revenues will help carriers cover their costs and prevent possible fleet size decreases. Now, airlines will be hoping that this recovery proves to be far more consistent and another wave of infections doesn't wipe out the industry again.

Another notable story this month has been the startup airline Akasa Air. Backed by a legendary investor and industry veterans, the airline could make its appearance in 2022 and shake up these numbers quickly.

What do you think about India's domestic recovery? Let us know in the comments!