India's aviation sector witnessed a significant shift in competitive dynamics during December, with market leader IndiGo ceding substantial ground to rival Air India Group following operational disruptions. According to monthly traffic data released by the Directorate General of Civil Aviation (DGCA), IndiGo's domestic market share plummeted by nearly four percentage points in December, marking its lowest monthly performance in two years.
Market Share Decline and Operational Challenges
The country's largest airline, IndiGo, saw its market share drop to 59.6% in December from 63.6% in November. This decline represents the most substantial monthly loss for the carrier in recent history and underscores how operational reliability has become a critical factor in India's competitive aviation landscape.
Root Causes of Disruption
InterGlobe Aviation-owned IndiGo experienced an operational meltdown during the first week of December, resulting in over 4,500 flight cancellations that stranded lakhs of passengers across the country. The mass cancellations were primarily triggered by the implementation of new pilot rest rules and stricter night-time flying hour norms, forcing the Gurugram-based airline to reduce scheduled domestic departures by approximately 10%.
This was not an isolated incident—IndiGo had already lost around two percentage points of market share in November, even before the December disruptions peaked, indicating a sustained impact from operational challenges.
Passenger Traffic Reflects Capacity Cuts
The decline in market share was mirrored by a substantial drop in passenger numbers. IndiGo carried 85.23 lakh passengers in December, representing a 12% sequential decrease from 96.93 lakh in November and an 11% year-on-year decline from 96.15 lakh passengers in December 2024.
Despite the December setback, IndiGo maintained a strong annual performance for 2025, ending the year with a 64% market share compared to 61.9% in 2024. On a full-year basis, the airline transported 1,068.64 lakh passengers in 2025, marking a 7% increase over the 999.04 lakh passengers carried in 2024.
Air India Group Emerges as Primary Beneficiary
The Tata-backed Air India Group emerged as the biggest beneficiary of IndiGo's operational difficulties, gaining over three percentage points of market share during December. The group, which includes Air India and Air India Express, recorded a 29.6% market share in December—its highest monthly performance in the past 12 months.
For the full year 2025, Air India Group ended with a 27% market share, marking its first complete year of combined operations following the Tata Group's consolidation of Air India and Air India Express.
Other Players and Overall Market Trends
SNV Aviation-owned Akasa Air, India's third-largest airline by revenue, maintained a stable 5.2% market share in December, largely unchanged from the previous month. For 2025, Akasa's market share stood at approximately 5.1%, showing improvement from the 4.6% recorded in 2024.
Overall, India's domestic airlines carried 1,669.46 lakh passengers in 2025, reflecting a 3.48% growth over the previous year. However, this growth rate has slowed significantly, nearly halving from the 6.12% expansion recorded in 2024 when airlines transported 1,613.31 lakh passengers.
Industry Implications
The December traffic data highlights how quickly operational disruptions can translate into lost market share, even for dominant carriers like IndiGo. The aviation market's competitive dynamics are increasingly shaped by reliability factors, with passengers and market share flowing toward airlines demonstrating consistent operational performance.
This episode serves as a reminder that market leadership in India's aviation sector requires not just scale and pricing power, but also robust operational resilience to navigate regulatory changes and maintain service consistency.
