India plans action against IndiGo over flight cancellations to 'set an example'
Passengers wait outside the IndiGo airlines ticketing counter at the Chhatrapati Shivaji Maharaj International Airport, after several IndiGo airlines flights were cancelled, in Mumbai, India, Dec 6, 2025. (Photo: Reuters/Francis Mascarenhas)
India will take strict action against IndiGo following at least 2,000 flight cancellations this month, the country's civil aviation minister said on Monday (Dec 8), to "set an example" for airlines that violate regulations.
The cancellations by India's biggest airline, due to crew shortages after it failed to plan in time for stricter rules on pilot rest, left tens of thousands of passengers stranded, upending vacation plans and weddings, and sparked a growing passenger fury about lost luggage.
It has also raised concerns about the dominance of a single airline in a country of 1.4 billion people.
The crisis has sent IndiGo's shares down nearly 17 per cent over the past seven days, wiping US$4.3 billion off its market value. That included an 8.3 per cent drop in the share price on Monday.
"We are doing an inquiry and will take very, very strict action ... we will set an example for all the other airlines," Minister Ram Mohan Naidu told lawmakers. IndiGo did not immediately respond to a request for comment on Naidu's remarks.
India's aviation regulator has served notices to IndiGo CEO Pieter Elbers and COO Isidre Porqueras, warning of regulatory action that could include penalties and officials being suspended, according to notices seen by Reuters on Saturday.
EARNINGS HIT EXPECTED
In the first indication of the number of passengers affected, the government said 586,705 tickets were cancelled between Dec 1 and Dec 7, and refunds of 569.65 crore rupees (US$63.22 million) were issued.
JM Financial estimated on Monday an earnings hit of 8 to 9 per cent for the fiscal year ending next March, if the disruptions last for a total of about 15 days, excluding any penalty the government may impose over the disruptions. Moody's Ratings warned on Monday that IndiGo could face "significant financial damage".
IndiGo, which controls about 65 per cent of the Indian aviation market, has said it failed to plan adequately for a Nov 1 deadline to implement stricter rules on night flying and weekly rest for pilots. Other Indian airlines have not had the same problems.
On Monday, IndiGo cancelled about 500 flights, according to the Indian government.
Meanwhile, investors are placing bets that other airlines will benefit from IndiGo's woes. Shares of rival SpiceJet, one of the few listed major airlines in India, jumped 13.9 per cent on Monday.
Safety is a key concern as IndiGo looks to fix things, said Matt Driskill, editor of Asian Aviation Magazine.
"You have all thousands of flights that have been disrupted, you've got unhappy passengers, and you have an airline that is scrambling to get pilots and flight crews back in the air. You've got ground handlers as well. And when people are rushing, rushing, rushing and rushing, that's when mistakes happen. And when mistakes happen in aviation, people die," he told CNA's Asia First programme.
"Everybody needs IndiGo needs to slow down. They can't just throw the planes back in the air and not expect mistakes to happen."
Driskill also said IndiGo's market share is "too big" and that the Indian government should step in to do something about it.
In terms of what measures could be levied against IndiGo, he said the airline will likely be fined. The government could also restrict it from opening new routes, amid IndiGo's attempts to buy longer-haul planes from Airbus.
As India continues its efforts to expand its aviation market and get more people to fly, it needs to pay more attention to the industry, Driskill noted.
"I do think the regulator bears some responsibility (for the crisis)," he added.
