Indian Domestic Aviation Sees July Slump Amid Capacity Lean Period As Air Traffic Falls By 4.8 Per Cent; IndiGo Extends Market Dominance To Over 67 Pc

Mumbai, August 21, 2026: India’s domestic aviation sector experienced a temporary contraction in July 2026, driven by seasonal demand shifts and operational adjustments. The month-on-month passenger traffic slipped by 4.8% to 1.2 crore travellers compared to 1.26 crore in June.

Despite the dip, year-to-date performance remained stable, with airlines carrying 9.84 crore passengers in the first seven months of 2026 – recording a marginal 0.64% increase over the 9.77 crore recorded during the same period last year.

Passenger Load Factors Decline

A widespread drop in passenger load factors (PLF) reflected the broader slump in passenger volumes. Virtually every scheduled domestic carrier reported lower seat occupancy compared to June 2026.

Although Akasa Air had the highest overall PLF at 91.9%, it was slightly down from 92.2% in June. SpiceJet, Air India Group and IndiGo recorded marginal drops to 84.1%, 83.2% and 82.4%, respectively.

While the regional carriers like Star Air and Alliance Air slipped slightly to 74.3% and 59.5%, IndiaOne Air plummeted massively from 59.3% to 44.5%. The sole exception to the trend was Goa-based regional operator Fly91, which bucked the market trend by increasing its PLF from 73.2% in June to 74.7% in July.

Seasonal Slowdown Hits Traffic

According to industry insiders, the fall in traffic is driven by several factors like higher airfares due to rising fuel costs and capacity rationalisation by airlines. This has been fuelled by the seasonal slowdown during monsoon.

IndiGo Extends Market Dominance

Market leader IndiGo continued to expand its market dominance, commanding a 67.4% share of the domestic market in July – up from 66.3% in June – after carrying 80.82 lakh passengers.

While Air India Group’s share increased by a fraction from 23.9% to 24%, Akasa Air’s market share dropped significantly from 6.4% to 5.5%, along with SpiceJet, which plummeted from 1.9% to 1.6%.

The low-cost carrier also led operational reliability among major airlines, securing the top spot for on-time performance (OTP) at 91.2% across ten major Indian airports. Akasa Air followed closely in punctuality with an impressive 90.8% OTP, while Air India Group achieved an 88.5% OTP.

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SpiceJet struggled significantly with operational timelines, reporting an OTP of just 34.6%, while delaying 28.37% of its flights by more than two hours. Across all operators, reactionary delays accounted for 65% of total flight disruptions during the month.

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