India’s domestic aviation market is set to witness a significant transformation as three new homegrown airlines, Air Kerala, Alhindair, and Shankh Air, are preparing to launch operations in early 2024. This expansion comes at a time when the country’s air travel industry is booming, with domestic travel showing a 23.57% year-on-year growth in 2023.
New Players Ready for Takeoff
Over the past two months, the Civil Aviation Ministry has granted No Objection Certificates (NOCs) to Air Kerala and Alhindair, both based in Kerala, and Shankh Air, from Uttar Pradesh. These airlines are currently undergoing the final process of acquiring Air Operator Certificates (AOC) to start their commercial flight services on scheduled routes.
Focus on Domestic and Regional Connectivity
The primary focus of these new airlines will be to enhance regional and intra-state connectivity. Air Kerala and Alhindair plan to eventually target the high-demand routes between South India and the Middle East, a sector with significant traffic potential.
Booming Aviation
Market India’s aviation sector has experienced a surge in domestic air passenger traffic, which rose to 152 million in 2023, up from 123 million in 2022. This growth highlights the increasing demand for air travel among the country’s burgeoning middle class, making it an ideal time for new players to enter the market.
Competitive Landscape
The Indian aviation market is currently dominated by IndiGo, which holds over 62% of the market share, followed by Tata Group airlines such as Air India and Vistara, which together control nearly 30% of the passenger traffic. The entry of these new airlines is expected to enhance competition, providing more options and better pricing for consumers.
Changes in the Market
The grounding of Jet Airways in 2019 and Go First in 2023, combined with Tata Group’s decision to merge Vistara with Air India and Air India Express with AIX Connect, was leading the market toward a duopoly. However, with the entry of new players and SpiceJet securing fresh capital of Rs 3,000 crore, the domestic market is seeing renewed competition and positive sentiment.
The launch of Air Kerala, Alhindair, and Shankh Air is set to reshape India’s aviation landscape, offering more choices and competitive pricing for passengers while boosting regional connectivity. As these airlines prepare for takeoff, they are poised to play a key role in India’s rapidly growing aviation sector.
