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    IndiGo CEO Rono Dutta says air travel demand stronger than pre-COVID

    aviation | IST

    IndiGo CEO Rono Dutta says air travel demand stronger than pre-COVID

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    The 71-year-old aviation veteran, who is retiring on September 30, reiterated that he is “very enthusiastic” about revenue and aims for a consistent increase in unit revenue at the rate of 3-4 percent every year.

    The demand for air travel has become stronger than pre-COVID, IndiGo CEO Ronojoy "Rono" Dutta told CNBC-TV18 in an exclusive interview.
    “Demand has been very strong, now we are way above COVID level… I can say with conviction that we have recovered from COVID,” Dutta said. As a result, the airline is also witnessing more passengers travelling more frequently, leading to a 5-6 percent monthly growth in revenue. "The airline is steadily marching upwards," Dutta said.
    While the news is good on the revenue side, the cost pressures remain for the airline in terms of crude oil rates and foreign exchange. Offsetting the 5-6 percent monthly revenue growth is fuel cost, which is going up by 11 percent per month.
    “We are on the cusp of profitability... need a little bit of help on the cost side. We have a glimmer of hope; a lot depends on crude oil prices… Oil prices need to behave,” Dutta said.
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    The 71-year-old aviation veteran, who is retiring on September 30, reiterated that he is “very enthusiastic” about revenue and aims for a consistent increase in unit revenue at the rate of 3-4 percent every year.
    Dutta also continues to be bullish on the growth potential in the Indian aviation sector, and sees airport infrastructure as the only constraint. Citing the example of the Delhi airport, which has emerged among 10 busiest airports in the world without connecting traffic, Dutta said Indian metro airports have a massive potential once hubs are developed to attract connecting traffic as well.
    “We are seeing in aviation is just the first ripple, the wave is yet to come,” Dutta said.
    The airline is also focused on reducing its debt, which has increased 23.5 percent year-on-year to Rs 36,877.8 crore in the fourth quarter of the 2022 fiscal.
    “Forward bookings dwindled during COVID, now they are back. We will slowly be reducing our debt. Pre-COVID, we were close to zero debt. Over time, we would like to aim for very little debt,” Dutta said.
    The airline is more focused on customer-friendly service as a part of its strategy to gain more passengers, and a higher market share is a by-product of that mechanism, Dutta said, adding that the airline’s strength is its network. IndiGo, the largest domestic carrier, has also resumed hiring and is currently recruiting 400 flight attendants.
    “Our philosophy is that at every stage customer should ask why I am not booking IndiGo,” Dutta said.
    The airline is looking at a net addition of 15 aircraft in its fleet over the next year. As of March 2022, IndiGo had 275 aircraft in its fleet.
    Once IndiGo starts taking delivery of Airbus A321XLR in 2024, it will aggressively expand its international operations.
    “International profitability has been higher than domestic… Before-covid, international was about 25 percent of our capacity. Our plan is to take international capacity to 40 percent,” Dutta said.
    The airline board’s recent decision to appoint current President and CEO of KLM, Pieter Elbers, as its CEO from October is also being seen as a part of IndiGo’s strategy to deepen its network in the global markets specifically.
    “The IndiGo board is looking for a CEO with tenureship of 8-10 years... Pieter Elbers has a wonderful reputation, knows the European market very well... IndiGo will heavily expand in Europe with A321XLR,” Dutta said.
    Talking about the period of transition, Dutta said that Elbers will become available from July and start making trips to India after that.
    On being his future beyond IndiGo, Dutta said that he will definitely be working for another airline as he cannot “imagine retiring” from aviation.
    “We are all here on a transit visa... None of us is here on a permanent residence status. Moving on is part of our game.. .I am moving ahead with the true spirit of an adventurer… I am a bit of a nomad... I love to work for an airline, can’t imagine anything else... cannot imagine retiring from aviation. Love aviation with a passion,” Dutta said.
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