Kempegowda International Airport Clinches 'Best Domestic Airport' Title at Travel + Leisure India’s Best Awards 2023

In a momentous triumph, Kempegowda International Airport Bengaluru (BLR Airport) has been crowned the 'Best Domestic Airport' at the 12th edition of the Travel + Leisure India’s Best Awards 2023. The prestigious accolade was bestowed upon the airport during a ceremony held at the ITC Maurya in New Delhi.

The Travel + Leisure India’s Best Awards are widely recognized across India and South Asia, serving as a distinguished acknowledgment of excellence in travel, hospitality, and lifestyle. This annual reader’s choice award celebrates the crème de la crème of establishments in the hospitality industry.

A Testament to Excellence

BLR Airport's relentless pursuit of excellence in transforming passenger experiences played a pivotal role in securing this coveted title. The airport's overarching goal is not merely to serve as a transit point but to evolve into a destination in its own right. The management at BLR Airport is committed to continuous improvement and innovation, ensuring that the airport stays abreast of evolving customer needs and leverages emerging technologies to enhance the overall passenger experience.

Hari Marar, the Managing Director & CEO of Bangalore International Airport Limited (BIAL), expressed his gratitude for the national recognition, stating, "We are honored to be recognized nationally as the best domestic airport in the country. At BLR Airport, we are dedicated to continually improving service standards. This award acknowledges the hard work of our entire airport community, and we are grateful to our growing and dedicated passengers for their vote of confidence and continued support.”

A Commitment to Transformation

BLR Airport's commitment to transformation is underscored by its proactive approach to updating its offerings. The airport consistently adapts to the latest trends and technologies, ensuring that passengers benefit from a seamless and state-of-the-art travel experience. This commitment was particularly evident during the challenging voting process for the Travel + Leisure India’s Best Awards this year.

Record-breaking Support

The voting process, which extended over three months, culminated in a record-breaking 523,270+ votes. In this remarkable achievement, BLR Airport distinguished itself among other leading airports, solidifying its position as a frontrunner in the industry. The overwhelming support from passengers reflects their confidence in BLR Airport's dedication to providing top-notch services and setting industry benchmarks.

Looking Ahead

As BLR Airport basks in the glory of being named the 'Best Domestic Airport,' the management remains forward-looking. The airport's commitment to excellence serves as a foundation for future endeavors, as it continues to evolve, adapt, and elevate the travel experience for its passengers. With an unwavering focus on service standards, innovation, and customer satisfaction, Kempegowda International Airport Bengaluru is set to remain a beacon of excellence in the aviation landscape.

Conclusion

In summary, the 'Best Domestic Airport' title at the Travel + Leisure India’s Best Awards 2023 is not just a recognition of past achievements but a testament to BLR Airport's ongoing commitment to excellence and innovation in the realm of travel and hospitality.

In the dynamic landscape of Indian aviation, IndiGo, the country's largest airline, has soared to unprecedented heights in 2023. Boasting remarkable achievements in passenger traffic, daily flights, and network expansion, the low-cost carrier has now etched its name in history by becoming the first Indian airline to fly 100 million passengers in a calendar year.

Unprecedented Growth

IndiGo's growth trajectory has been nothing short of phenomenal. Surpassing the scale of operations of its counterparts, the airline has achieved a significant milestone by flying 22% more passengers in 2023 than the previous year. Pieter Elbers, the CEO of IndiGo, expressed his delight, attributing this success to customer trust, hard work, and the execution of a meticulously crafted strategy.

Market Dominance and International Expansion

IndiGo commands over 60% of India's domestic market share, an impressive feat that underscores its dominance. The airline's international network has witnessed rapid expansion, with the addition of 20 international routes in just six months. Presently, IndiGo serves 118 destinations, including 32 international locations, firmly placing it among the top ten airlines globally by passenger traffic.

Exclusive Routes and Operational Milestones

A common sight at Indian airports, departure and arrival boards are overwhelmingly filled with IndiGo flights. Many of the routes operated by the carrier are exclusive, devoid of competition from rival airlines. Earlier this year, IndiGo achieved another milestone by becoming the first Indian airline to operate over 2,000 flights in a single day, encompassing scheduled passenger and cargo flights, as well as military charters.

Global Recognition and Market Valuation

IndiGo's impact extends beyond Indian borders, earning it a position among the ten largest airlines globally by passenger traffic. In terms of market valuation, the airline holds the 6th position worldwide, with its parent company, Interglobe Aviation, commanding an impressive valuation of $13.8 billion—outshining some renowned global names. Notably, this valuation surpasses that of the U.S. carrier United Airlines.

Challenges Amid Success

Despite these achievements, IndiGo faces challenges, notably with several of its Airbus A320-family jets grounded due to engine issues. The airline has navigated this setback by wet leasing aircraft and extending the lifespan of older planes. While the grounding of additional aircraft due to Pratt & Whitney engine issues may impact operations in the coming months, IndiGo's leading position in the Indian aviation sector remains unchallenged.

Conclusion

IndiGo's journey in 2023 is a testament to its resilience, strategic prowess, and unwavering commitment to connecting people and aspirations. As the first Indian airline to achieve the monumental feat of flying 100 million passengers in a calendar year, IndiGo continues to redefine the benchmarks of success in the aviation industry. With its robust market position, expansive network, and global recognition, IndiGo is not just an airline; it is a symbol of India's aviation prowess on the world stage.

Air India Express is making significant strides in its fleet development, aligning with its strategic plans to enhance operational capabilities and customer experience. The airline has recently inked a sale and leaseback deal with Griffin Global Asset Management and Bain Capital for the acquisition of ten Boeing 737 MAX aircraft, marking a pivotal step in the carrier's comprehensive transformation.

Sale and Leaseback Deal

The sale and leaseback arrangement, a common practice in the aviation sector, involves Air India Express selling the aircraft to Griffin Global Asset Management and Bain Capital, only to lease them back for operational use. This financial maneuver allows the airline to unlock substantial cash while retaining the ability to utilize the newly acquired Boeing narrowbody planes.

Strategic Partnership with Griffin Global Asset Management

Griffin Global Asset Management, a reputable player in commercial aircraft leasing and alternative asset management, is a key partner in this venture. With offices in Dublin, Puerto Rico, and Los Angeles, Griffin brings profound expertise to the table, making them an ideal collaborator for Air India Express in financing and leasing these ten aircraft.

Modernizing the Fleet for Enhanced Experience

Nipun Aggarwal, Chief Commercial & Transformation Officer of Air India, and Director of Air India Express, emphasized the importance of fleet modernization as a pivotal element in the ongoing transformation of the Air India group. The new Boeing 737 MAX aircraft are seen as significant enhancements, promising customers a differentiated flying experience, improved reliability, and enhanced cost efficiency.

Delivery Schedule and Expansion Plans

The first aircraft from the deal was already delivered in November, with the remaining nine set to join the fleet in the coming months, spanning the fourth quarter of 2023 and the first quarter of 2024. This acquisition is part of the broader fleet expansion plan for Air India Express, which includes the arrival of a total of 55 Boeing 737 MAX aircraft over the next 11–15 months.

Strategic Move: Leveraging Undelivered MAXs

Air India Express seized a strategic opportunity in acquiring some of the Boeing 737 MAX aircraft originally intended for Chinese carriers. With delays in recertification by Chinese regulators following the two fatal crashes, these undelivered MAXs, meant for airlines like Air China, China Eastern, and Shanghai Airlines, became available, allowing Air India Express to bolster its fleet efficiently.

Privatization and Renewed Focus

The recent developments highlight the transformation of Air India Express following its privatization. The airline, once overlooked as a state carrier, has undergone a rebranding and initiated a major fleet development program. The focus on fleet expansion is a testament to its commitment to growth and competitiveness in the dynamic aviation industry.

Upcoming Phases and Collaborative Growth

This acquisition of ten Boeing 737 MAX aircraft represents the initial phase of Air India Express's broader fleet expansion plan. In total, the airline is set to receive 190 737 MAX aircraft as part of a larger order with Boeing. The expansion necessitates the induction of over 300 pilots in the coming months, supporting both domestic and international growth for the carrier.

Conclusion

In summary, Air India Express's strategic moves in fleet development, particularly the recent sale and leaseback deal for Boeing 737 MAX aircraft, signal a new era for the airline. As it embraces modernization and expansion, the carrier is poised to provide an elevated flying experience while positioning itself as a competitive player in the evolving aviation landscape.

The Indian airline industry is poised for a significant recovery, with credit ratings agency ICRA projecting a substantial reduction in net losses for the fiscal year 2024. The optimistic outlook is attributed to improved yields and a stable cost environment.

Passenger Traffic Growth: A Positive Trajectory

ICRA forecasts an 8-13% expansion in domestic air passenger traffic for both FY2024 and FY2025. This follows a robust recovery in FY2023, where domestic air passenger traffic surpassed pre-Covid levels. The current fiscal year is expected to witness further growth, reaching 150-155 million passengers, indicating sustained momentum in the industry.

Financial Outlook: Net Losses Set to Shrink

ICRA anticipates a significant reduction in the industry's net losses, projecting a decline from an estimated Rs 17,000-17,500 crore in FY2023 to Rs 3,000-5,000 crore in FY2024. Improved yields and a stable cost environment are identified as key contributors to this positive trend. However, challenges such as elevated aviation turbine fuel (ATF) prices and currency depreciation remain monitorable factors.

International Operations and Fleet Expansion

The report highlights the growing role of Indian carriers in international traffic, with a 42% share in FY2023. ICRA sees substantial growth potential in this segment, driven by fleet additions and expansion plans. The industry is set to receive around 1,500 aircraft, with a focus on replacing older models with fuel-efficient ones. Despite supply chain issues, the gradual addition of aircraft is expected to maintain a balance in demand and supply.

Challenges: Supply Chain Issues and Operational Concerns

While the industry is on a recovery path, challenges persist. The current supply chain issues, particularly those related to engines manufactured by Pratt & Whitney, have led to approximately 20-22% of the total fleet being grounded. This could further escalate, impacting operating expenses, lease rentals, and overall cost structures, posing potential obstacles to the industry's recovery.

Fuel Prices and Currency Dynamics

ATF prices, a significant component of airline expenses, have experienced fluctuations. The average ATF price stood at Rs 103,189/KL in 9M FY2024, reflecting a 59% increase compared to pre-Covid levels in FY2020. Additionally, the depreciation of the Indian Rupee against the US Dollar poses challenges, as a considerable portion of operating expenses is denominated in US dollars.

Conclusion

The Indian airline industry is navigating a complex landscape marked by encouraging recovery prospects and lingering challenges. While the projection of reduced net losses is a positive signal, the industry must remain vigilant in addressing ongoing supply chain issues, fluctuating fuel prices, and currency dynamics. The gradual recovery in passenger traffic, coupled with strategic fleet expansions, positions the industry for growth in the medium term, provided it effectively manages the hurdles along the way.

SpiceJet, a prominent low-cost airline, is currently embroiled in a legal battle with its engine lessor, Engine Lease Finance BV. The lessor has filed an application in the Delhi High Court, claiming that SpiceJet has failed to fulfill its payment obligations as per agreements, leading to a series of legal proceedings and interim settlements.

Background

In October 2023, Engine Lease Finance BV and SpiceJet reached an interim settlement, with the lessor agreeing not to pursue a stay application against the airline. However, recent developments suggest that SpiceJet has only made partial payments, prompting the lessor to approach the Delhi High Court once again.

Allegations and Court Proceedings

Engine Lease Finance BV alleges that SpiceJet has not adhered to the terms outlined in the October settlement. The Delhi High Court, after hearing submissions on December 15, emphasized that the airline cannot flout its undertaking and directed SpiceJet to file an affidavit regarding its commitment to payment. The case is scheduled for further hearing on December 19.

Settlement Terms

As part of the settlement, SpiceJet is obligated to pay over $2 million to Engine Lease Finance by January. Additionally, the airline has undertaken to return the disputed engine by January 25. Failure to comply with these commitments gives the lessor the right to approach the court.

Previous Court Orders

Earlier in October, the Delhi High Court granted SpiceJet until October 16 to settle the dispute and warned of restraining the airline from using the engine if no resolution was reached. Engine Lease Finance had terminated its lease with SpiceJet on September 27, seeking a court order to prevent the airline from using their engine after the termination.

Insolvency Pleas and Supreme Court Cases

In 2023, SpiceJet faced insolvency pleas from four aircraft lessors, including Aircastle Ireland Ltd., Willis Lease Corporation, Wilmington, and Celestial, citing non-payment of dues. While the National Company Law Tribunal (NCLT) dismissed one such plea in early December, SpiceJet continues to grapple with legal challenges, including a case against Credit Suisse at the Supreme Court over unpaid dues.

Conclusion

SpiceJet's ongoing legal battles raise concerns about the financial stability of the airline and its ability to meet its contractual obligations. The outcome of the current dispute with Engine Lease Finance BV and other legal challenges will significantly impact the future operations and reputation of SpiceJet within the aviation industry. The court's decisions in the coming days will shed light on the airline's financial viability and its ability to resolve conflicts with its creditors.

With Inputs from Money Control