India's aviation landscape saw a notable shift in late 2025, with market leader IndiGo experiencing a significant dip in its domestic market share in December, while the Air India Group made considerable gains. IndiGo's share dropped to 59.6 percent in December 2025 from 63.6 percent in November 2025, largely due to widespread flight cancellations. During the same period, the Air India Group, including Air India and Air India Express, saw its market share rise to 29.6 percent from 26.7 percent, benefiting from its rival's operational challenges.This six-month span highlights a dynamic competitive environment as both airlines pursue ambitious expansion and transformation plans.[business-standard+2]
IndiGo's Domestic Dominance Faces Turbulence
Despite the December 2025 setback, IndiGo maintained its position as India's largest airline, ending 2025 with an annual market share of 64 percent, an increase from 61.9 percent in 2024.In May 2025, the airline had commanded a substantial 65 percent of the domestic market.However, the nearly four percentage point decline in December marked IndiGo's lowest monthly market share in two years.[livemint+2]
The operational disruptions in December 2025 led to mass flight cancellations and a reduction in daily departures for IndiGo.This created an opportunity for other carriers to capture a larger share of the passenger traffic. IndiGo's parent company, InterGlobe Aviation, also reported a net loss of ₹2,582 crore in the second quarter of financial year 2025 (July-September 2025). This loss was mainly due to higher foreign exchange costs, despite a 9.3 percent increase in revenue from operations to ₹18,555 crore.[livemint]
Air India's Strategic Resurgence Pays Off[livemint]
The Air India Group emerged as the primary beneficiary of IndiGo's December 2025 challenges, logging its strongest monthly gain in market share. Thegroup's domestic market share reached 29.6 percent in December 2025, up from 26.7 percent in the previous month. This increase underscores the impact of operational reliability on competitive dynamics in the Indian aviation market.[livemint+2]
Air India's improved performance comes amid a significant transformation effort backed by the Tata Group. In financial year 2025, Tata Sons and Singapore Airlines injected a substantial ₹9,558 crore into Air India. This capital infusion supports the airline's ongoing transformation plans, capital expenditure, and working capital needs. The merger of Vistara with Air India in November 2024 also significantly bolstered Air India's fleet, adding 70 aircraft and growing its total fleet to 205 during FY25. Air India also recorded a profit, excluding exceptional items, in the second half of FY25, and its revenue reached a record ₹61,000 crore for the full fiscal year.[livemint+8]
Both Airlines Eye Global Expansion[thehindu]
Both IndiGo and Air India are aggressively expanding their international footprints, signaling a broader strategic shift beyond the domestic market. IndiGo plans to add one new aircraft every week throughout financial year 2026, aiming for a fleet of over 600 aircraft by 2030. The airline is boosting its long-haul capabilities by damp-leasing six Boeing 787-9 Dreamliners. IndiGo launched 10 new international destinations and 30 new international routes in 2025. New international routes from Delhi to Denpasar, Bali, Krabi, and Manchester began in October and November 2025. IndiGo will also launch non-stop services to Athens from Mumbai and New Delhi starting January 23, 2026, using its first Airbus A321XLR aircraft. The airline aims to increase its international capacity share from 28 percent to 40 percent by 2030.[bwtravel+10]
Air India is also making significant strides in its global network. In December 2024, the airline placed an order for 100 additional Airbus aircraft, including 10 A350s and 90 A320 family jets. The first Boeing 787-9 was expected in December 2025, with a new wide-body aircraft arriving every six weeks through 2026-28. Air India plans to induct 26 new aircraft in 2026, though its net fleet count will remain flat due to retirements. The airline is also upgrading its existing fleet, with the first two refurbished Boeing 787-8 aircraft returning to service in February 2026. New international routes to Dallas, Los Angeles, Manila, and Jakarta were launched in 2025. Air India will also reintroduce its Delhi-Rome route in March 2026 and deploy Boeing 777 aircraft with First Class suites on its Delhi-Melbourne service starting July 1, 2026.[blog+7]
The recent six-month period highlights the intense competition in India's aviation sector. While IndiGo continues its dominant growth trajectory, operational issues can quickly shift market dynamics. Air India, with significant investment and strategic fleet and network enhancements, is increasingly positioning itself as a formidable contender, especially in the international long-haul segment.[youtube+1]
