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Excess capacity big concern for a volatile aviation sector
Indian airlines have faced near-constant turbulence since the onset of the pandemic. Then came the volatility in fuel prices and the weak rupee, which continue to cloud their path to profitability. The demand for air travel has not recovered sustainably so far. “Since last year, there has been an unprecedented rise in jet fuel prices, which was further aggravated by the Russia-Ukraine war, which in turn has also pushed fares, impacting leisure travel demand to an extent. Hence, the combination of these factors has impacted the capacity deployment levels for the sector," said Suprio Banerjee, vice president and sector head, corporate ratings, ICRA Ltd. The issue is excess capacity resulting from volatility in demand for air travel in India. Similarly, AirAsia India operated 1,010 flight departures per week in August and, thereby, operated 63% of its approved summer schedule. Source - Mint #indianairlines #airasia #india
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