The Air India Group has implemented a significant reduction in its flight network for June 2026, cutting 1.46 million seats as part of an operational restructuring strategy. This move comes as the airline group aims to mitigate substantial losses, reported to be Rs 28,500 crore in FY26.
Capacity Contraction Across Group Carriers
According to data from OAG, a global aviation data provider, Air India, which holds a 12% market share as the second-largest airline, saw its capacity contract by 27% in June 2026 compared to the previous year, resulting in 1 million fewer seats. Air India Express (IX) also reduced its capacity by 17% over June 2025 figures, accounting for 463,000 fewer seats. Combined, the Air India Group carriers now operate 22% of the total capacity in the Indian market.
Metropolitan Cities Bear the Brunt
The capacity cuts have disproportionately affected major Indian metropolitan cities, with reductions observed across Mumbai, Chennai, Hyderabad, Bengaluru, and Kolkata. Mumbai and Bengaluru, which are jointly the second busiest airports with 1.7 million seats each in June 2026, experienced capacity cuts of 7.7% and 6.4% respectively. Hyderabad saw a notable domestic capacity decline of 19% year-on-year, while Chennai also faced a significant 17% reduction.
In contrast, Delhi stands as an exception among the metros, with seat availability across all airlines increasing by 8.9% in June 2026. Delhi remains India's busiest airport for domestic flights, recording 2.8 million seats for the month, a 9% rise from the previous year.
International Sector Adjustments
Internationally, the United Arab Emirates continues to be the busiest market from India, despite a 15% reduction in capacity to just under 1 million seats, still representing 27% of the market. Thailand, the next busiest international destination, saw a 10% capacity cut to 260,000 seats, holding a 7% market share. Capacity was also reduced across various Middle East destinations and to Singapore by 12%, totaling 249,000 seats. Conversely, the airlines have increased capacity to the UK by 19%, adding 213,000 seats, making it the fifth busiest international market.
Strategic Shift Towards Loss Reduction
The Tata Group, owners of Air India, has reportedly directed the airline to prioritize reducing its substantial losses. This strategic shift involves delaying deliveries of new aircraft that are on order, cutting more flights, and scaling back previously planned expansion initiatives.