IndiGo CEO Pieter Elbers Affirms the Persistence of Pricing Fluctuations

IndiGo, one of India’s leading airlines, has been facing protests and criticism over the recent surge in airfares across the country. In response to these concerns, Pieter Elbers, the CEO of IndiGo, affirmed that pricing fluctuations in the airline industry are inevitable and will persist.

During an interview with ETNow, Elbers acknowledged that the temporary disruptions in capacity, caused by the suspension of flying by Go First, have led to price fluctuations. He stated, “Things are more stable now, and prices are also stabilizing to that level.” This suggests that the airline expects airfares to return to a more normal range as the market adjusts to the changes in capacity.

The surge in airfares can be attributed to the growing demand for travel combined with a reduction in supply. Go First, facing financial difficulties, has had to ground half of its aircraft due to supply chain disruptions related to Pratt & Whitney (P&W) jet engines. As a result, this has created a void in India’s aviation market, allowing rival airlines to take advantage of the situation by obtaining GoFirst’s airport slots. The government, as an interim measure, allocated these slots to other airlines following GoFirst’s grounding on May 3. Prior to the shutdown, GoFirst held a market share of around 7 percent and possessed approximately 53 slots in Delhi and Mumbai airports.

IndiGo Airlines

Despite the challenges faced by the industry, IndiGo remains determined to expand its international presence in line with the growth of the Indian economy. Currently serving 78 domestic destinations, the airline already operates flights to 26 international destinations with 75 international city pairs. In the coming years, IndiGo aims to increase its international seat share from 23 percent in FY23 to 30 percent within the next two years. To support this expansion, the airline plans to add approximately 46 to 50 aircraft by FY24.

Elbers emphasized that IndiGo will continue to prioritize its internationalization strategy. While the airline may make some adjustments to its domestic network to fill the void left by GoFirst’s suspension, the plan to expand its international operations remains intact. In August, IndiGo will commence services on the Mumbai and Nairobi routes, further strengthening its international footprint.

As the industry stabilizes and adjusts to the recent disruptions, it is hoped that airfares will gradually return to a more reasonable level, providing greater accessibility to air travel for passengers across India.

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