Vistara, India's third-largest airline, encountered a significant setback in early April with a spate of domestic flight cancellations attributed to 'crew unavailability.' This issue, brewing for some time, not only poses challenges for Tata-owned Vistara but also casts a shadow over the broader aviation industry, raising concerns about passenger inconvenience in the upcoming weeks.
At the heart of Vistara's crisis lies the inability to reach an agreement with its staff regarding a new pay structure ahead of its merger with sister airline Air India. Reports indicate that the proposed pay package, which entails reducing pilots' minimum flying time from 70 to 40 hours per week, has met resistance from pilots due to potential pay cuts. The deadline for accepting the new terms was March 15, and when pilots voiced their discontent by calling in sick leave collectively, Vistara had no choice but to cancel flights, sometimes dozens per day, resulting in a significant decline in its on-time performance (OTP) to 51%.
Similar disruptions were witnessed during the Air India-Indian Airlines merger in 2007, highlighting the vulnerability of airlines with slim margins and minimal crew to flight delays and cancellations when crew members fail to report for duty.
Vistara's management has responded by addressing the situation proactively. CEO Vinod Kannan stated on April 6 that 98% of pilots have signed the new pay contract. Efforts are underway to recruit more pilots, adjust operations for flexibility, and deploy larger aircraft on select domestic routes to accommodate passengers. Despite an improvement in OTP to 80% the following day, challenges persist as some pilots remain apprehensive about the contract.
To mitigate further disruptions, Vistara has opted to reduce its flight operations by 10% starting April 7 to maintain OTP and avoid last-minute cancellations. However, experts warn that this reduction in operations could drive airfares up by 10-20% during the peak summer season, exacerbating an already strained aviation market due to factors like IndiGo's aircraft grounding and Go First's financial challenges. With Vistara grappling with a pilot shortage, summer travel may become more arduous for passengers.
