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Air India to tap biz travellers for financial turnaround

30 Dec 2010 Evaluate

State-owned airline Air India is reaching out to business chambers in nonmetros with proposals to start intra-state services. The airline is reeling under Rs 19,000-crore debt and is now tapping business travellers by introducing 40-seater planes on routes within states. The airline could also take in state governments as equity partners for regional services. The company viewed Gujarat, Kerala, Tamil Nadu and Punjab as promising states for air-services.It has sought four preferred international and domestic routes along with the weekly potential of passenger and cargo load. The airline was keen to inter-connect Ahmedabad, Surat, Jamnagar , Bhavnagar, Rajkot, Surat, Bhuj and Kandla.

The Centre infused Rs 800 crore additional equity in Air India in 2009-10 and is expected to get Rs 1,200 crore from the government in this financial year. Air India has a fleet of 160 aircraft and 31,000 employees. The airline lowered its net loss to Rs 5,551 crore from Rs 7,189 crore last year.  Air India had ordered total 111 new aircraft at an investment of $13 billion in 2006 with Airbus and Boeing to replace old plane and decrease aircraft on lease. The delivery of 27 aircraft (Boeing 787) has been delayed and the company would get it from June 2011. New aircraft will help the company to increase the number of passengers.crackcrack

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