Why is South India's aviation market seeing a new boom with eVTOL and carriers?

South India is now seeing a commercial aviation resurgence.

This follows a period where the region lost its aviation map prominence. Historically, the first private airline was Thiruvananthapuram-based East-West Airlines in the 1990s. The region later saw the collapse of carriers like Kingfisher Airlines and Air Deccan. Now, a new wave of carriers is ready to launch. This new era includes both regional airlines and advanced technology firms.

A New Wave of Regional Carriers

New entrants are preparing to take to the skies by mid-2026. These airlines are receiving key regulatory approvals. The Union Ministry of Civil Aviation granted No-Objection Certificates (NOCs) in late 2025.

• AlHind Air: This Kerala-based carrier received its NOC in December 2025. It is promoted by the Kozhikode-based Al-Hind Group. The airline plans to use ATR 72-600 aircraft for domestic routes. It will later expand to international services using Airbus A320 aircraft. The focus is on connecting South India with the Gulf region.
• FlyExpress: This Hyderabad-based firm also received an NOC in December 2025.
• Air Kerala: This carrier aims to be an ultra-low-cost option. It plans to launch domestic flights from Cochin International Airport (COK).

These launches reflect a push to diversify the market. The DGCA data shows a high market concentration. Currently, IndiGo controls over 53% of the domestic market. The entry of new carriers is seen as a way to ease duopoly concerns. This activity signals a vibrant future for the Indian private sector in air travel.

The Future: eVTOL and Advanced Manufacturing

The South India aviation runway is also becoming a hub for future technology. The region is seeing a surge of Electric Vertical Takeoff and Landing (eVTOL) startups. This is a major component of the commercial aviation resurgence.

Integrated eVTOL Ecosystem

Bengaluru-based Sarla Aviation is leading this push. The company signed a Memorandum of Understanding (MoU) with the Andhra Pradesh government. They plan a 500-acre eVTOL manufacturing 'giga campus'. The initial investment is set at INR 1,300 crore. This facility aims to produce up to 1,000 aircraft annually by 2029. The goal is to support future air-taxi operations across South India.

• The campus will be a fully integrated ecosystem.
• It will include manufacturing, flight testing, and pilot training.
• Sarla Aviation is developing a six-seater hybrid-electric VTOL called 'Shunya'.

Other key players include Chennai-based The ePlane Company. Hyderabad-based BluJ Aerospace is developing hydrogen eVTOLs. These developments position the region at the forefront of Urban Air Mobility.

Market Opportunity and Challenges

The new activity is supported by strong market fundamentals. India is the world's fastest-growing domestic air traffic market. The overall Indian aviation market is forecast to grow at a 12.03% CAGR through 2030. South India, in particular, shows a substantial upside. The region is projected to grow at a 14.2% Compound Annual Growth Rate (CAGR). This growth is driven by major tech and aerospace clusters.

However, the history of Kingfisher Airlines Air Deccan serves as a warning. Sustaining operations in a highly competitive market remains a significant challenge. The government’s Regional Connectivity Scheme (UDAN) is crucial. It helps make new routes commercially viable. Global manufacturers like Boeing forecast strong growth. They predict the South Asia region will be the fastest-growing market. This growth requires significant investment in infrastructure. It also demands a large increase in skilled personnel. The new carriers and eVTOL plans are vital for the future of Indian air travel and improving regional air connectivity. Read more commercial aviation news on flying.flights.