IndiGo sees demand inching up, reduces leave without pay for pilots

Airbus A320 and A321 pilots will have leave without pay of three days per month and for captains of regional aircraft fleet ATR-72 there will be no more LWP

In an apparent sign of recovery of the aviation sector from the Covid-19 pandemic, India’s largest airline IndiGo has reduced leave without pay (LWP) for its pilots from monthly 10 days in July to three days in November.

Domestic air traffic jumped the most since the lockdown, with a month-on-month growth of 39 percent in September.

Data from industry regulator DGCA showed that 3.94 million people travelled in September compared to 2.83 million in August.

While pilots of single aisle aircraft like Airbus A320 and A321 will have leave without pay of three days per month, for captains of regional aircraft fleet like ATR-72 there will be no more LWP.

In June IndiGo had implemented a mandatory leave without pay program for 1.5 days to 5 days. Subsequently, in July, IndiGo announced 5.5 additional days of LWP for its pilots, taking the effective number of LWP to 10 days.

As cost cutting measure, the airline had also let go of 10 percent of its employees and implemented a pay cut across the board.

“The festive season is here and it brings along positivity and happiness all around us! As we continue to remain optimistic about the passenger demand growing over the next few months, I would like to share the following update with you for the month of November.

LWP for pilots on the Airbus fleet and First Officers on the ATR fleet, shall be reduced to 3 days. As shared earlier, we will review the LWP policy on a monthly basis,” Ashim Mitra, the airline’s flight operations head wrote to pilots yesterday.

Sources said that, as the airline is utilising more of its aircraft as it sees a growth in demand. In second quarter, IndiGo had a capacity utilisation of over 30 percent, and ended it at 47 percent, much above its peers.

CEO Ronojoy Dutta informed during the post-results analyst call, the airline is using 58 percent of its capacity, a little below the 60 percent capacity limit set by the government.

“We expect to operate at about 80 percent capacity by the end of 2020 and at about 100 percent by April-May 2021. This would, however, depend on the government removing capacity restrictions," Dutta said, adding that the airline’s focus will be on aggressively expanding its domestic capacity.

He signalled that the company will be calling back its employees as capacity utilisation improves. However, CFO Aditya Pande said that the airline will keep salary costs 30 percent lower than its pre-Covid-19 levels, meaning pay cuts for employees will continue for some time to come.

IndiGo has not deferred its aircraft induction plan and has added eight new aircraft during July-September period. However, it has also retired around 10 older aircraft in order to bring down maintenance cost.