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Misbehaving Airline Staff: What Does The Data Say About Indigo?

Indigo suffered two major PR disasters within a week – one where a passenger was hurt after she fell off a wheelchair because of gross negligence by an Indigo crew member and another, where a passenger was pinned down by yet another Indigo crew member. The last couple of weeks have been somewhat traumatic for Indigo, with yet another incident wherein ace shuttler P V Sindhu alleged misbehaviour by Indigo crew members.

Indigo, largely known for its on-time USP and pre-flight formalities, is in an expansion drive while already controlling 40% of the domestic Indian market share.

Which airlines do Indians fly domestically?

Monthly data from the Directorate General of Civil Aviation shows that while Air India has been gradually ceding market space to its private rivals, Indigo has maintained its dominating presence catering to 4 out of 10 Indians flying domestically.

Market share of Indian domestic airlines

Misbehaving crew has been a major grouse for passengers, with complaints under that tab ranging from 6-12% of all complaints.

Share of misbehaving crew

Air India has also seen the highest number of complaints per 10,000 passengers over time. Considering its scale of operations, Indigo has till now maintained one of the lowest rates of passenger complaints. However, its recent run-ins with misbehaving crew members, it is yet to see whether data will reflect the same. Watch this space for regular updates.

No. of complaints per 10k pax

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President’s low vote share

2,930

What is it? The number of votes with a value of 702,044 won by Ram Nath Kovind in India’s 2017 Presidential Elections.

Why is it important? Kovind has been elected as the 14th President of India. However, with 65.65% vote share, it is the lowest for a presidential election winner since 1974. Cross voting from opposition parties in favour of NDA-backed candidate, Kovind, was reported in seven states including Gujarat, Maharashtra, Goa, Punjab, Assam, West Bengal and Tripura.

Tell me more: Meira Kumar, who was backed by a 17-member bloc of opposition parties, polled in 1,844 votes with a value of 367,314.

 

1 million

What is it? The number of people who died from AIDS-related deaths globally in 2016, according to the UNAIDS.

Why is it important? This is a 48% drop from the peak of such deaths in 2005 (1.9 million AIDS-related deaths). Now, a higher number of people are accessing anti-retroviral therapy – 19.5 million in 2016, up from 17.1 million in 2015 and 7.7 million in 2010. This makes it the first time that more than half of those living with HIV are receiving life-saving treatment. Since 2010, new HIV infections have come down by an estimated 11% in adults to 1.7 million in 2016 and by 47% among children to 160,000 in 2016.

Tell me more: Achieving the 90-90-90 targets (90% of all living with HIV know their HIV status, 90% of those diagnosed with HIV are accessing sustained anti-retroviral therapy and 90% of those receiving this therapy are virally suppressed) by 2020 seems feasible. In 2016, 70% know their HIV status, of this, 77% were accessing treatment and of those accessing treatment, 82% were virally suppressed.

 

30-50%

What is it? The percentage of salary and stipend cuts that Jet Airways has reportedly asked its junior pilots to take.

Why is it important? The airline has asked them to take these cuts or quit their jobs. These measures, which are to be implemented fromAugust 1, will impact 400 of its pilots of the approximate strength of 1,500. Jet Airways has attributed its actions slowdown in the Gulf region and to improve operational efficiency.

Tell me more: Jet Airways, which faces stiff competition from low-cost airlines such as Indigo and SpiceJet, saw its market share fall to 18% at the end of June this year from 23% two years ago.

 

171

What is it? The number of runs scored by cricketer Harmanpreet Kaur in the semi-finals against Australia in the Women’s World Cup.

Why is it important? The innings is the “third-highest score in a world cup and fifth-highest overall”. Before this match, India has won less than 30% of the matches against Australia, which has won the world cup six times.

Tell me more: This is Team India’s second time at the women’s ICC World Cup finals (after 2005). The semi-final match was cut down to 42 overs due to rain. India will now face England in the World Cup finals on July 23.

 

Rs 9,079 crore

What is it? The net profit of Reliance Industries (RIL) for the first quarter of FY18, ended June 30, an increase of 28%.

Why is it important? The gross refining margins – the profit from turning one barrel of crude oil into fuel – was at a nine-year high. Its gross refining margin was $11.9 a barrel, higher than the average Singapore benchmark at $6.4 a barrel in the June quarter.

Tell me more: RIL also gained from selling 76% stake in the Gulf Africa Petroleum Corp, a South African subsidiary, for Rs 1,087 crore.

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The on-time numbers that IndiGo is contesting

This piece originally appeared on Livemint.com

 

In the last five years, IndiGo’s share in domestic flights to and from Mumbai has increased from 21.5% to 30%. During this period, the market leader’s ‘on-time performance’—defined as taking off or landing within 15 minutes of the scheduled time—has taken a beating: down from 72% to 56%. Its fall is most pronounced in the past year (chart 1), and it trailed SpiceJet and Jet Airways in December 2016. Even other airlines have seen drops in Mumbai, but none as much as IndiGo.

In late December, IndiGo wrote to the aviation regulator, citing issues with data-collection methods followed by the GVK Group-run Mumbai airport to compute on-time performance. These methods, it alleged, were inaccurate and favoured rival airlines. The regulator has since set up a panel to examine the issue, opening another front of friction between airlines. On-time performance data put out by the Mumbai airport shows that IndiGo is losing out in the busy part of the day (chart 2), though it was the best in controlling what’s in its hands (chart 3).

 

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Why Indian airlines favour international flights over domestic ones

This piece originally appeared on Livemint.com

 

India this month relaxed rules for new airlines wishing to fly overseas. The consistent demand from these airlines for easier rules has been due to a single reason: the favourable economics of international flights over domestic ones.

Higher growth and margins

Jet Airways leads all airlines in international air passenger traffic in and out of India. International operations accounted for 56% of Jet’s revenues in 2015-16, but it started flying abroad in 2004.

Today, a more illustrative representation of the potential of the international segment for a new airline is IndiGo, which started foreign flights in 2011. At Rs1,470 crore, international flights accounted for 9.1% of IndiGo’s total revenues in 2015-16. But on every headline growth and profitability metric, IndiGo’s international piece is outperforming its domestic piece (launched in 2006). That’s partly because of the longer distances flown, even for IndiGo, which does short-haul international flights only, unlike Air India and Jet, which do both short-haul and long-haul flights.

 

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Greater share of India’s international air traffic

The share of Indian airlines in India’s international air passenger traffic has increased in the last decade. In 2014-15, 15 airlines accounted for 75% of this traffic. In this bucket are all the five Indian airlines allowed to fly abroad, with a cumulative share of about 37%. IndiGo and SpiceJet, which started international flights only in 2011 and 2010, respectively, and oriented their international operations around shorter routes, are already ranked nine and 10, respectively.

 

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Volumes in the shorter routes

For an Indian airline looking to fly international, volumes are in the shorter routes to the Middle East and Asia-Pacific. The likes of IndiGo and SpiceJet have capitalized on this, in the process mostly preserving their low-cost character and fleet portfolio. Among the top 15 countries, which account for 88% of India’s international traffic, 12 are short-haul routes with India. Likewise, of the top 15 city routes, which account for 30% of India’s international traffic, 13 are short-haul.

 

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Source: Directorate General of Civil Aviation (DGCA), financial results of InterGlobe Aviation Ltd (which operates IndiGo) and Jet Airways (India) Ltd.

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