IndiGo to cut domestic flight capacity by up to 7 per cent amid rising fuel costs

Representational image. File pic

Indian Aviation giant IndiGo is set to reduce its domestic flight capacity by 5-7 per cent between June and August 2026. By reducing the flight capacity, Indigo will become the second major Indian carrier after Air India to scale back operations amid rising cost pressures and softer post-summer travel demand.

As reported by IANS, the airline has also already reduced its international capacity by nearly 17 per cent as part of temporary schedule adjustments.

The move comes shortly after Air India announced a 22 per cent reduction in domestic flight operations during June and July.

Rise in aviation fuel prices

Industry observers said the sharp rise in aviation fuel prices has been one of the key factors impacting airline operations. Jet fuel accounts for nearly a quarter of an airline's operating expenses, making carriers highly sensitive to fluctuations in crude oil prices.

The ongoing Iran conflict has added further uncertainty to global energy markets, pushing crude oil prices significantly higher in recent months.

Weakening Indian Rupee is also a major reason

Since India imports a large portion of its crude oil requirements, domestic airlines have been particularly vulnerable to rising ATF costs. A weakening rupee has also increased the cost burden for carriers.

At the same time, airlines typically witness softer passenger demand after the peak summer vacation season, when school holiday travel tapers off, as per IANS.

Analysts, while expressing their views on the increasing demand and rising jet fuel prices, said, "The combined impact of moderating demand and higher fuel expenses has forced airlines to recalibrate their capacity plans," as per IANS.

However, iANS sources familiar with the matter said that IndiGo's decision was primarily linked to demand-based capacity adjustments and not directly related to fuel prices.

"This is being done for capacity adjustments basis demand. Nothing related to ATF," the sources said.

Meanwhile, a major scare was reported at Kempegowda International Airport on Tuesday after smoke was noticed in an IndiGo flight bound for Chennai while the aircraft was taxiing for departure.

According to the airline, IndiGo flight 6E 6017 from Bengaluru to Chennai was taxing out towards the runway when smoke was observed in the aircraft.

(With inputs from IANS)