SpiceJet vs IndiGo: How pandemic set the two airlines on diverging paths

SpiceJet's financial struggles highlighted as unpaid dues lead to enhanced surveillance, contrasting with IndiGo's market dominance.

The never-ending financial troubles of the cash-strapped SpiceJet airline were once again on display when passengers flying from Dubai to India were barred from checking in due to the airline’s unpaid dues. Following this, the Directorate General of Civil Aviation placed SpiceJet under ‘enhanced surveillance’. Earlier that month, they audited the airline and found ‘certain deficiencies’. These new challenges arose while the airline was already dealing with payment and provident fund dues to employees and legal disputes as lessors were not paid. Pilots and cabin crew were last paid salaries for June and 150 cabin crew were sent on unpaid leave, The Hindu had reported.

Data shows that a series of steps taken to expand the airline in the years leading up to the pandemic — driven by the sudden collapse of Jet Airways and the desire to capture a larger share of the growing market — may have proven to be costly.

Unlike the market leader IndiGo, who had been increasing the size of its fleet and crew steadily over time and expanded further before the pandemic, SpiceJet’s leap was sudden.

Chart 1 shows the fleet size of IndiGo and SpiceJet over time.

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Between FY18 and FY20, IndiGo increased its fleet size from 159 to 262 aircraft, with SpiceJet improving from 60 to 114 . Both also went on a hiring spree during the period.

Chart 2 shows the strength of pilots and cabin crews in IndiGo and SpiceJet