IndiGo's turbulent ride in Q2: Airline battles higher fuel costs, grounded aircraft
IndiGo Airlines faced challenges in the second quarter with high fuel prices and grounded aircraft, leading to a Rs 987 crore loss despite a topline increase. Issues with Pratt & Whitney engines and hoax bomb threats further impacted operations. Despite setbacks, the airline is optimistic, planning to launch a business class and seeing favorable response to its new loyalty program.
The airline reported a loss of Rs 987 crore in the second quarter ended September 2024.
The company had reported a profit of Rs 189 crore in the September quarter of the previous year and Rs 2,728 crore in the preceding June quarter.
Like in the first quarter, the Pratt & Whitney engine issues continue to cause turbulence for IndiGo, which has affected hundreds of Airbus A320neo jets worldwide.
As informed in the post-earnings call, nearly 60 of IndiGo's fleet remains grounded, down from 70 in Q1. Elbers acknowledged the headwinds and said, “In a traditionally weaker second quarter, results were further impacted by headwinds related to groundings and fuel costs .” However, he also shared a positive outlook and said, “We have turned the corner as the number of grounded aircraft and associated costs have started reducing.
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at London Business School, Speaker, Author, Global Thought Leader View Program Notably, several Indian airlines' operations including IndiGo's have taken a further hit in October due to the hoax bomb threats received in the last two weeks, impact of which maybe seen in the forthcoming quarter.
Meanwhile, the company’s expansion efforts continue with optimism, banking on the growth in the Indian market as it aims to maintain its position as a cost leader.
"Revenue from domestic market grew more than the international market," IndiGo said in a concall.
Looking to diversify its offerings, IndiGo is preparing to launch a business class in two weeks, enhancing service options for its growing customer base, as announced earlier this year.
The airline’s new loyalty program , IndiGo BluChip, is also seeing a favorable response as IndiGo competes in a crowded market, the CEO said.
Elbers further highlighted that IndiGo’s “6E family” served 28 million passengers this quarter.
