SpiceJet results reflect the challenges facing Indian airlines

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India’s SpiceJet has reported a sharp increase in its net losses for the last fiscal year, but it surprisingly had a relatively strong fourth quarter.

It is still not clear if that is a sign that things are taking a turn for the better in the Indian airline industry, but the fact remains that the carrier is still making losses due to high costs despite stronger demand for its services.

The other listed Indian carriers, Jet Airways and Kingfisher Airlines, will soon be reporting their full year results and that will give us a clearer indication of where things are going. And state-owned Air India and some of the privately held airlines are still not making money.

The Indian airline industry is still very much in the red overall, and there are numerous challenges ahead for them. They ordered too many aircraft during the boom times, and they focused on increasing market share without worrying about profits.

Expect to see more consolidation in the coming year as they grapple with both rising costs and falling demand for air travel. There is still much work ahead for India’s airline industry.

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