Noida Airport is up and running, but the big traffic switch is yet to come

Noida International Airport (NIA) has seen a slower-than-expected start to operations, prompting its developer and concessionaire Zurich Airport International AG to factor in a more gradual ramp-up amid weak airline capacity, connectivity challenges and competition from Delhi’s Indira Gandhi International Airport (IGIA), The Times of India reported.

Zurich Airport International AG, the primary developer and concessionaire of NIA, said the airport’s near-term performance remained uncertain but maintained confidence in its long-term prospects.

“Slower ramp up expected due to challenging geopolitical environment with near-time performance remaining subject to elevated uncertainty. Route network will continue to expand with international services expected to follow. Strong confidence in the long-term growth potential and attractive fundamentals of the Indian aviation market,” TOI quoted Zurich AG's outlook for NIA.


Also Read: Noida Airport turns one month old, is it still flying half-empty?

NIA began domestic passenger operations on June 15. It handled 104 flights and 25,000 passengers in June, with traffic rising to 1,044 flights and 77,000 passengers in July.

The airport’s estimated loss before interest, taxes, depreciation and amortisation (EBITDA) for the first half of the year is around $3 million.

IndiGo is by far the largest operator at NIA, while Akasa Air operates a smaller number of flights. Air India Express, which was expected to be the third launch airline, withdrew from the airport amid mounting losses across the Air India group.

Establishing a new base at NIA would have required Air India Express to incur significant costs at a time when the group was looking to contain expenses.

Before the airline pulled out, NIA had expected to handle around 60 lakh passengers in its first year. That translated to an average monthly traffic of about 5 lakh passengers. July’s passenger count of 77,000 was well below that level.

The airport’s slow start comes against a difficult operating backdrop. Unlike some other Indian cities, the National Capital Region already has a major international airport operating below its full capacity.

Delhi’s IGIA currently has annual capacity of around 11 crore passengers but handled fewer than 8 crore passengers last year. The airport operates about 1,300 flights a day, compared with around 1,550 during the G20 summit in Delhi.

Also Read: Delhi airport plans to increase annual passenger handling capacity to 125 million

This leaves NIA competing with an established airport that has stronger connectivity to Delhi, Gurgaon, Noida and Ghaziabad and offers access through a range of affordable multimodal transport options.

NIA is also the only case of a second international airport opening in a major Indian urban cluster without the existing airport either operating at capacity, facing major constraints or being replaced. Airports in Mumbai, Goa, Bengaluru and Hyderabad had different circumstances when their newer facilities opened or were planned.

NIA had been expected to face a difficult period until IGIA approached saturation, which was earlier projected to happen by around 2030, when the Delhi airport was expected to reach its peak capacity of around 13-14 crore passengers annually.

Connectivity to the wider NCR remains another challenge for NIA. While peak-hour slots are expected to be one of its advantages, access from major population and business centres across the region could influence how quickly airlines and passengers shift traffic to the new airport.

The timing of NIA’s launch has also coincided with pressure on Indian airlines. Carriers are dealing with the closure of Pakistani airspace, which has made some western routes commercially difficult, higher oil prices linked to the US-Iran conflict and a weaker rupee.

These pressures have prompted airlines to cut flights and reassess expansion plans, adding to the challenges facing a new airport seeking to build traffic from scratch.

Despite the slower initial ramp-up, Zurich has maintained that NIA's long-term prospects remain strong as its route network expands and international operations are added.

(With inputs from TOI)