Monday 29 April 2013

Air India still in the midst of turbulence?

In the present time with new airlines flying sleek aircrafts and young crew compete in the aviation business; India with a grand old Air India is still living in the bygone Maharaja era with uncle-aunty crew. The Air India air hostesses once known as hawai-sundari are now seniors who still cling to flying duties.  Earlier it used to be said, ‘Air India me safar karo.’ And in the last many years, Indian flyers are complaining, ‘Air India me suffer karo.’ Senior retired officials admit that over the years Air India was milked by officials and staff to the maximum; and an unprofessional attitude was mainly responsible for the bad state of affairs of the national carrier. Other airlines are getting younger and fitter. However, if Air India thinks of some new measures to upgrade the carrier, the unions block the proposal saying it is not in the interest of the staff and crew. And the end result is the uncle-aunty crew competing with modern airlines run professionally, with smart young staff and crew.

Market share for international traffic to and from India in 2011-12, Air India Group is 18.3%, as per Aviation Ministry. Is the tide turning for Air India? Huge losses, a 2-month long pilot strike and grounding of Dreamliner fleet. Are things finally looking up for Air India for the first time since its merger with erstwhile Indian Airlines in 2007? Air India is beginning to experience a reversal of fortune. Air India will be EBIDTA positive this year. EBIDTA of earnings before interest, taxes, depreciation and amortization is the approximate measure of a firm’s operating cash flow. Air India’s expected cash surplus in 2012-13 is Rs 25 crore and estimated cash surplus by 2013-14 is Rs 1,000 crore. The airline is also expected to turn profitable by 2018.

The government will infuse additional capital of about Rs 30,000 crore into Air India by 2020. And Rs 6,750 crore equity capital, the government will infuse into the airline in 2012-13. The government has infused Rs 3, 200 crore between 2009 and 20012.

Rise in the passenger revenue during April-Dec 2012 was Rs 680 crore, compared to the year-ago period. 70.4% Load factor during the period against 68.4% a year ago. And there has been a decline in net loss during the period which was earlier at Rs 1,110 crore.

The positive fallout is the encouraging sign of pilots who had had resigned from the airlines to take up lucrative job offers abroad are looking to join back. Basically the work ethics and the sarkari attitude of the crew and staff have to change to compete and meet the new challenges in the aviation business. The airline has 1,496 pilots on its rolls, out of which 32 are expatriates. ‘Air India pilots are a pampered lot and they will find it very claustrophobic to work in any professionally run airlines’, said a retired Air India pilot. However, while salary and perks may be better in some foreign carriers, Air India pilots will find it very difficult to adapt to the working conditions of other professionally-run carriers.

Experts attribute to the turnaround and positive trend to better working conditions at the national carrier and its recent improved performance. But the recent tie-up of Jet Airways and Etihad will affect Air India the most, but it can still meet the challenges with a professional approach and proper planning to keep its market share going. And very soon the grounded Dreamliner aircraft will start flying giving the carrier more options.

Will the maharajah rule the sky again? Possibly not, but with the increasing market share of international traffic, will keep the Indian flag flying and will serve the Indian fliers, many of whom still love to fly Air India.


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  2. Bad Attitude led them to bad places in the industry. They were only interested in job security and not service. They got killed by their own attitude. I'm glad it happened.