InvestorQ : How is the airline industry likely to be impacted by the COVID-19 with respect to the key players like Indigo and Spice Jet?
NISHA Nayak made post

How is the airline industry likely to be impacted by the COVID-19 with respect to the key players like Indigo and Spice Jet?

Answer
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5 months ago


Most of the airline companies including Indigo and Spice Jet are likely to see compression in passenger numbers due to a combination of lesser travel requirements, more travel restrictions and also due to social distancing requirements. It is estimated that for the full year 2020, passenger traffic overall may fall by 47%. The aviation sector has been seeking financial support from the government of India. Airlines have been the worst hit by the COVID-19 pandemic, as flights had to be grounded for two months. Even IATA had complained that the government Rs.21 trillion rescue package contained nothing for the airline industry. IATA also pointed out that the sharp fall in passenger traffic could result in revenue loss of $11 billion and put nearly 30 lakh direct and indirect jobs at risk. Airline in India already operate on low yields due to the high taxes levied on aviation fuel and other charges like landing and parking slots at airports.