Digitization and air freight have helped Indian airlines affected by Covid survive
The government must act quickly to save this sector from permanent damage.
The Covid-19 pandemic has hit the aviation industry hardest. India’s sudden lockdown in March 2020 was its nemesis. As a result, all passenger flights were banned from March 23, 2020. When they opened in May 2020, there were restrictions on the capacity of seats as well as on the price of tickets. Either way, the fear of stealing from passengers made matters worse. In addition, no concessions of any kind have been granted to the airline industry. The profitability of airlines has always been slim due to strong domestic competition. Many airlines had made more money flying overseas than within the country, but that also ended. Repatriation flights of Indians stranded abroad, known as “Vande Bharat” flights, began on May 23, 2020, but with severe restrictions. This was followed by the opening of domestic flights on May 25, 2020, with restrictions. Then began the “bubble arrangements” with some selected countries, and these “arrangements” are still continuing. The second wave of Covid made all of this erratic. Domestic and international flights, which also began on 23/25 May 2020, have had their share of uncertainty due to the conflagration of Covid in different parts of the country and with foreign states and countries reimposing their restrictions / conditions or stopping altogether for a while. However, airline losses have steadily increased. Unnecessary restrictions were imposed on domestic flights, with price restrictions and seat occupancy reducing profitability. According to CAPA, Indian airlines could lose US $ 3-4 billion in fiscal year 2020-2021 and have a fleet surplus of 200-250 aircraft. This industry has a great impact on employment, both direct and indirect, of skilled and unskilled varieties. The government must act quickly to save this sector from permanent damage.
They say that every crisis is also an opportunity. While airlines were already sufficiently immersed in digital technology for their operations more than other sectors of the economy, Covid has been a “boost”.
For passengers, ticketing and travel has become a contactless experience to a much greater extent – booking a ticket to download the boarding pass and baggage tag has become the norm. While online ticket shopping was already very popular, the seamless passenger experience at the airport has improved significantly, bringing back passenger confidence. The boarding pass, which was an unnecessary requirement for security personnel not followed anywhere in the world, was eventually scrapped. The use of social media by passengers and airlines has also increased. Messages sent by airlines regarding your flight have become commonplace. Delays and flight cancellations were on your smartphone. If a state required an RT-PCR test to enter, you would be notified via SMS. All of this was done with improved software. Some airlines have improved their inflight entertainment. Ordering food online has become possible to be served in-flight. At the same time, airlines have phased out all paper magazines and replaced them with electronic copies.
In the case of SpiceJet, a major exercise was undertaken with their internal IT team to ensure that the passenger experience was the best. Upon arrival, each passenger would receive an SMS requesting one minute of their time for a passenger travel survey. All the reactions of the passengers were automatically processed by the software produced in-house and transmitted to the agent concerned. In the event of a complaint / defect, a response will be sent to the passenger within 24 hours and corrective action will be taken. In the event of a compliment, the staff would be rewarded. This improvement in staff performance and incentive leads to increased productivity. It also enabled SpiceTech, its IT arm, to secure software development contracts from foreign airlines.
Due to all these factors, the workload at the airport check-in counter has become negligible. As most passengers came with their own printing of boarding pass and baggage tags, check-in time was reduced. The only contact that remained was if a passenger had excess baggage and the passenger needed to make a payment.
Another big change that took place during the Covid era was the sudden increase in freight requirements. Domestic freight was a marginal activity for airlines. But with Covid, the demand for freight has increased suddenly. Indian airlines did not have cargo planes; some airlines have therefore started to use their passenger planes for cargo delivery.
Besides the belly of the plane, they wanted to use the passenger seats to carry cargo. It was here that permission from the government and the airline’s manufacturer was needed, but luckily the two cooperated and it was cleared. This practice of passenger planes of carrying cargo only or partially on the seats was a big step forward in authorizations.
This has set a precedent for airlines, which sometimes have to park their passenger planes during the lean season, and they will use this option as and when required in the future.
The concept of air freight experienced a significant boom during this period. A company like Amazon that sent small quantities by air began to pre-book full planes for their freight. In fact, freight became the mainstay and survival of Indian airlines during this period.
One of the results of this Covid period is that airlines have learned to survive (at least so far). The reduction of staff and greater digitization of their activities have made them leaner and more efficient. In fact, currently, in a recent call for tenders / RFP issued by the IAA for the selection of a service provider for the provision of a passenger handling system (CUPPS, CUSS and BRS) at managed airports by the IAA, the Federation of Indian Airlines protested that the current system of setting a cost to the airline for each departing passenger should give way to the effective use of CUPPS, CUSS and BRS. Indeed, the use of these passenger check-in kiosks has decreased considerably at airports, as most passengers no longer use these terminals.
However, ironically, after achieving such great success for passenger comfort through digitization, this request was rejected by the Airports Authority of India.
Dr Sanat Kaul is President of the International Foundation for Aviation, Aerospace and Drones. He was the former Secretary of Civil Aviation, GOI, and can be contacted at: [email protected]