The moves come after the carrier experienced “one of the most demanding periods for Indian aviation”.
IndiGo has slashed its capacity growth expectations for the first quarter of fiscal year 2027, compared with the same period last year, and is looking at phasing out older, damp-leased aircraft after a sharp depreciation of the rupee and challenging operating environment pushed it to a full-year net loss of Rs23.9 billion ($252 million).
Speaking on a full-year earnings call on 29 May, IndiGo managing director Rahul Bhatia described the past year as “one of the most demanding periods for Indian aviation”.
The low-cost carrier is still recovering from an operational meltdown in December last year, which has been compounded by the crisis in the Middle East and its impact on fuel prices, together with depreciation of the rupee and changes to local labour laws.
Bhatia says the carrier has “further strengthened its resilience” since December, and the leadership that outgoing IATA director general and incoming IndiGo chief executive Willie Walsh will bring when he joins the carrier in early August “positions IndiGo well” for the future.
IndiGo has tampered down its capacity growth expectations for the first quarter of fiscal 2027, when it plans to increase capacity by 3-4%. This compares with a 16.4% growth in capacity during the same period last year.
The carrier is looking at phasing out most of its older, less fuel-efficient damp-leased aircraft as it seeks to offset skyrocketing fuel prices. IndiGo’s 441-strong fleet, as of 31 March, included 16 damp-leased jets – five Airbus A320ceos, five Boeing 737s and six Boeing 787s.
IndiGo’s management says a revised fuel surcharge introduced in April has enabled it to recover “a large part of the increased cost” in its domestic market, although “we haven’t been able to completely offset” costs on the international side. At the moment, demand for air travel is strong, says Bhatia, and the market has been “inelastic to heightened fares”. He adds: “We will look at this on a daily basis and see where we go.”
IndiGo’s A320-family aircraft are “central to the future of the company”, says Bhatia, and it will “protect” its short-haul operations as it explores its long-haul growth with the planned future addition of Airbus A321XLRs and A350s. Walsh’s “experience” of running an airline with a “hybrid model” fleet will stand the carrier in good stead, he adds.
The airline’s Rs23.9 billion full-year loss compares with a Rs72.6 billion profit the previous year. Total revenue rose 6.4% but was overshadowed by a 17% increase in expenses. IndiGo’s full-year capacity was up 9.5% on a 7.5% rise in revenue passenger kilometre (RPK) traffic, causing load factor to dip 1.6 percentage points to 84%.
In the quarter ended 31 March 2026, IndiGo posted a net loss of Rs25.4 billion, compared with a Rs30.7 billion profit in the same period a year earlier. Capacity in the fourth quarter was up 3.4% on a 1.5% rise in RPKs, while load factor declined 1.7 points to 86%.
The post IndiGo to cut capacity and remove older jets after posting full-year loss first appeared on FlightGlobal.