Aviation news international – Akasa Air, the latest addition to India\u2019s list of airlines, had been flying high following its launch last year. Recently, however, it has hit some turbulence, as dozens of pilots walked out, leading to hundreds of cancelled flights and angry customers.<\/p>\n
Experts say the challenge Akasa is facing only highlights what is set to become a much bigger problem in India, as airlines expand rapidly to meet rising demand in one of the world’s fastest growing aviation markets \u2013 but the availability of trained staff is failing to keep pace.<\/p>\n
\u201cMost of the players in the sector have a huge expansion plan, which would require a large base of skilled people including pilots, cabin crew and other operating staff,\u201d says Manish Chowdhury, head of research at broker StoxBox.<\/p>\n
\u201cWith the pace of supply of pilots lagging the demand in a big way, we expect this scramble for pilots to intensify.\u201d<\/p>\n
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\nMore than 40 pilots have resigned from Akasa Air in the past couple of months to join other airlines, including Air India Express, which also operates Boeing Max 737 planes.<\/p>\n
Akasa resorted to suing some of the departing pilots, with a representative for the airline saying the employees did not serve \u201ctheir mandatory contractual notice period\u201d and \u201cnot only is this illegal but also an unethical and selfish act that disrupted flights, forcing last-minute cancellations that stranded thousands of customers\u201d, according to a Times of India report.<\/p>\n
The High Court of Bombay on Wednesday allowed the airline to proceed with its lawsuit seeking contractual damages from some of the pilots.<\/p>\n
\u201cAkasa Air is facing an unprecedented and unique challenge in the civil aviation industry,\u201d says Jyoti Prakash Gadia, managing director at investment bank Resurgent India.<\/p>\n
\u201cUnlike the previous instances of funds shortages or technical glitches in the cases of some other airlines, Akasa is facing a crisis situation due to unanticipated resignation of its pilots.<\/p>\n
\u201cThe civil aviation sector as a whole is thriving and booming in India, with fresh opportunities due to increase in demand after the difficult pandemic period.<\/p>\n
\u201cThis has led to an apparent shortage of total number of experienced pilots required.\u201d<\/p>\n
Following the Covid-19 pandemic, demand for air travel in India has soared.<\/p>\n
India’s aviation industry handled about 200 million passengers in the financial year to the end of March, according to the Centre for Asia Pacific Aviation (Capa) India.<\/p>\n
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\nRising middle-class incomes in the world’s most populous nation and the world’s fastest growing major economy, along with the fact that only a single-digit percentage of the population currently travel by air, means the sector is expected to expand significantly over the coming years.<\/p>\n
Passenger numbers could grow to more than 1.3 billion annually in the next 20 years and by 2043, aviation could contribute up to $1 trillion annually to the Indian economy, Capa says.<\/p>\n
Akasa Air started operations in August last year.<\/p>\n
It was set up by late Indian billionaire Rakesh Jhunjhunwala, who teamed up with former Jet Airways chief executive Vinay Dube. Investor Jhunjhunwala, who was 62, died only days after the airline was launched due to health issues.<\/p>\n
The new airline has been billed as an \u201cultra low-cost carrier\u201d. It has expanded to fly to 16 destinations in India, including Mumbai, New Delhi, Kolkata, Goa and Hyderabad.<\/p>\n
But it faces fierce competition, with budget rivals including IndiGo, SpiceJet and Air India Express well-established in the market.<\/p>\n
The aviation sector in India is particularly tough and has a history of failed airlines, including Vijay Mallya’s Kingfisher Airlines and businessman Naresh Goyal’s Jet Airways.<\/p>\n
This year, low-cost carrier Go First, India’s fourth-largest airline, filed for bankruptcy and has yet to return to the skies after it plunged into a financial crisis it blamed on \u201cfaulty\u201d engines.<\/p>\n
India’s aviation market faces \u201ccut-throat competition, fare wars and structural challenges\u201d along with \u201cthe elevating cost of crude oil and jet fuel and depreciating rupee value\u201d, which is why some companies have failed to survive, says Nadiya Sarguroh, principal associate at MZM Legal.<\/p>\n
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\nBut it is also a market with huge potential for growth, which is why it is attracting new entrants, while existing airlines are seeking to expand.<\/p>\n
The expected demand growth has prompted Indian airlines to put in new bulk plane orders. But finding trained staff for these aircraft is becoming increasingly challenging, experts say.<\/p>\n
India will require up to 18,000 pilots over the next decade \u2013 but the Directorate General of Civil Aviation only registers 600 to 750 commercial pilot licences a year, according to estimates from Indian magazine Business Today.<\/p>\n
\u201cIdeally, the number of pilot licences issued per year would need to be doubled in order to operate the expanded fleet size,\u201d says Sanjay Shetty, director of professional search and selection for Randstad India, a human resources consultancy and recruitment agency.<\/p>\n
He says one factor behind the shortage is that \u201ca section of the pilot community is unemployable due to inadequate training and qualifications\u201d.<\/p>\n
\u201cTo tackle the pressing issue of the pilot shortage in India, firstly, substantial investments in upgrading and expanding training infrastructure are essential,\u201d says Mr Shetty.<\/p>\n
\u201cEqually important is the recruitment and retention of qualified instructors who can effectively impart industry-relevant skills.\u201d<\/p>\n
Indian airlines will need to work out how to manage this problem. One solution could be bringing in more pilots from abroad, Mr Gadia says.<\/p>\n
Outlook for aviation in 2023 – Business Extra
\nOutlook for aviation in 2023 – Business Extra
\n\u201cConsidering the expansion plans of various airlines, there is a likelihood of shortage of experienced pilots in the future,\u201d he says.<\/p>\n
Some airlines are already taking significant steps to address the problem.<\/p>\n
Air India, which was formally taken over by Tata Group last year, in February announced it is investing in an academy because of the recruitment issues in the industry.<\/p>\n
The airline has said it plans to hire more than 4,200 cabin crew and 900 pilots as part of its expansion.<\/p>\n
Despite the difficult operating environment, however, Akasa Air performed relatively well in its first year.<\/p>\n
By July, it had captured a 5.2 per cent share of India’s domestic aviation market, according to data from India’s Directorate General of Civil Aviation.<\/p>\n
In this relatively short space of time, the airline had even surpassed one of its rivals, SpiceJet. In August, however, Akasa’s market share fell to 4.2 per cent, as pilots deserted the carrier.<\/p>\n
Akasa gained \u201crecognition in the market with its budget price airfare making it a popular choice for passengers\u201d, Ms Sarguroh says.<\/p>\n
The carrier is likely to weather the bumpy patch it is facing.<\/p>\n
\u201cThough the company is likely to face operational losses and reputational damage, we look at the current event as transitory and believe that the company would emerge stronger post the fiasco,\u201d says Mr Chowdhury.<\/p>\n
\u201cOur confidence emanates from the fact that the newbie airline has created a strong footing in the market within a short period of time.<\/p>\n
“An airline veteran at the helm of affairs, a strong backing from reputed investors with deep pockets and a significant fleet and network expansion plans should ideally see it sailing the current rough waters.\u201d<\/p>\n