Airliners-India.com

andrew · Member Joined: 24 Apr 2007 Posts: 212

The reality my friends is that:

1. AI will never go to BIFR, it would be too embarassing for the govt.
2. AI will continue to get Govt funding and remain a lousy and inefficient service provider unable to attract the appropriate management talent
3. Eventually the Govt will undertake an IPO for 25% of the company and force some rationalisation through the market whilst changing FDI laws to allow IT to survive. Then AI will get a strategic forgein investor if the disinvestment scenario looks less political in five years....

In all of that... I'm not going to bother flying this tin can operation unless its the only show out of town....

HAWK21M · Posted: Fri Jun 19, 2009 12:36 pm Post subject:

GOI should start a new carrier,choose hardworking professionals,build up the fleet & gradually close down AI.
regds
MEL.
_________________
Think of the Brighter side !!!

karatecatman · Guest

TIMES OF INDIA
Air India tells senior management to forego July salary
19 Jun 2009

NEW DELHI: In a latest development, Air India CMD has asked its top management to forego salary for the July month.

Last week, an Air India spokesperson had said, "The salaries of June will be paid on July 15 due to the resource crunch that the company is facing."

According to TV reports AIR CMD on Friday has asked its directors and senior management to forego salary of July month.

Earlier, about 24,000 employees has threatened to go on an agitation later this month if their salaries are delayed by a fortnight as decided by the management.

"Members of Air Corporation Employees Union (ACEU), Aviation Industry Employee's Guild (AIEG) and Indian Aircraft Technicians Association (IATA) will jointly boycott their work on June 30 by adopting 'no pay, no work' policy if the management fails to give us our salary on June 30," ACEU General secretary J B Kadian had said.

The payment of productivity-linked incentive (PLI) has also been delayed by 15 days, according to a circular issued by Air India management.

Air India's losses for the last financial year are estimated at around Rs 4,000 crore, up from Rs 2,226 crore in the previous fiscal.

Reports say the national carrier was planning to seek Rs 5,000 crore as additional equity, Rs 7,000 crore as a soft loan payable after five years at a five per cent interest rate, and a grant of Rs 2,000 crore. However, top Air India officials have denied the figures, but said they are working on similar lines.

Maintaining that the financial crisis was foreseen last year, industry sources said the acute situation could have been avoided had Air India delayed the ongoing deliveries of aircraft, like its competitors Jet Airways and Kingfisher Airlines did.

Air India has placed orders for 111 new planes worth over Rs 45,000 crore and it currently has a paid-up capital of Rs 145 crore and authorized capital of Rs 1,500 crore package would not match Air India's expectations.

***

Have been given this by a senior Air India pilot:

Today Air India’s plight is due to one main reason: the combined greed of its IAS officers and a Mantriji, in collusion with some senior Air India officials. They have inked a billion dollar aircraft deal hoping to rake in a 7 percent commission safely tucked away in Swiss Banks. (How many times has the former CMD of AI quietly travelled to Zurich in the past three years and why?) They fudged the passenger growth figures hoping to hoodwink an entire nation which they have so far. Air India’s losses have risen EXPONENTIALLY with the purchase of aircraft – many of which were lying under-utilized due to poor route planning and insufficient passenger load. (I'm told one brand new Boeing 777 is now parked in Nagpur arport while a few brand new Airbus aircraft lie parked in other metro airports. Older Airbus aircraft too have their parts removed and lie unused.) And whenever loads picked up the ministry stopped operating flights to pave the way for other airlines- like the Frankfurt -Los Angeles route which was suddenly stopped to favour Jet Airways. Another excuse was a lack of pilots to fly the planes – an artificial shortage was created by failing Indian pilots in their written tests by the Government manipulated Director General Of Civil Aviation (DGCA). Not a single examiner of pilots written tests conducted by DGCA is a pilot – no wonder pilots are failing their exams ! The solution was to hire hundreds of foreign pilots through dubious placement firms based offshore ( Air India does not accept applications from foreigners directly but only through these “middlemen”). Obviously somebody is earning handsome kickbacks !

ranjanmehta · Member Joined: 29 Jun 2007 Posts: 108 Location: Dilli

AI won’t pay staff, but spends Rs 12 cr on crockery !

The promise of in-flight luxury could not have come at a worse time for the cash-strapped Maharaja.

While Air India’s staff waits for salaries and the airline seeks a Rs 15,000-crore bailout package from the Centre, it has purchased crockery and cutlery for Rs 12 crore. The new crockery and cutlery has been bought to go with its new menu introduced for business class travellers.

As per a notice issued by the airline’s deputy general manager (in-flight services) on May 29, the new menu and crockery were introduced in flights plying on the Mumbai-Delhi sector from June 1 and would be extended on other flights soon.

The existing crockery would be sold off as scrap.

“The company is making losses. They are asking for help from the government but the new chairman wants to change the crockery,” said an AI official, requesting anonymity. The airline had last purchased crockery in 2007 for Rs 15 crore for the newly acquired Boeing 747 and 777 long-range fleet when V Tulsidas was the chairman.

However, most of the crockery was never used because they did not fit in the oven.

“We either use the oven or use the bowls because the plates do not fit in the oven. The microwave too lay useless because the crockery has gold plating,” complained a senior cabin crew member with the airline.
The airline had also bought expensive mugs to serve tea. “Very few fliers like to have tea in mugs. They lay useless,” he added.

Despite projected losses of Rs 5,000 crore, Air India also introduced new uniforms for its staff from this month. An official Air India spokesperson said the airline could only reply when the department concerned reverts with an explanation, but he failed to specify when.

-----------------------------------
( Source: Hindustan Times )

AviationBuff · Member Joined: 20 Apr 2008 Posts: 57

Air India fighting for survival: CMD
Employees have called for an indefinite strike from July 1

http://timesofindia.indiatimes.com/Business/Air-India-fighting-for-survival-CMD/articleshow/4680719.cms

karatecatman · Guest

ECONOMIC TIMES
AI chief meets Cabinet Sec as carrier faces financial crunch
20 Jun 2009

PTI

NEW DELHI: Cash-strapped Air India on Saturday appealed to all its staffers to tighten their belts to face a major financial crunch, as its top man Arvind Jadhav met Cabinet Secretary K M Chandrasekhar here and discussed how the government could help the company face the financial rut.

The meeting Jadhav and Civil Aviation Secretary Madhavan Nambiar had with Chandrasekhar came after Air India approached the government for infusion of funds by way of equity, soft loans and a grant.

The ailing carrier, facing a situation similar to that of its private competitors Jet Airways and Kingfisher, has asked its top management not to take their July salaries and allowances and deferred by a fortnight the payment of June salaries and productivity-linked incentive (PLI) for all its 30,000 staffers.

Air India's losses for the last financial year are estimated at around Rs 4,000 crore, up from Rs 2,226 crore in the previous fiscal.

The demand made by the national carrier to the government comes in the wake of its orders for 111 new planes worth over Rs 45,000 crore against a puny paid-up capital of Rs 145 crore and authorised capital of Rs 1,500 crore.

Even as he discussed the financial crunch with the government, Jadhav issued an appeal to all employees asking them to unitedly "fight for survival of our own airline."

karatecatman · Guest

TIMES OF INDIA
Govt: Cash-strapped AI must prune order for new planes
21 Jun 2009
Saurabh Sinha, TNN

NEW DELHI: The government is likely to tell the cash-strapped Air India to prune its order for 111 planes that would cost the exchequer about Rs
44,000 crore. This order was placed three years ago when the aviation industry in India was growing at nearly 30% and the economy booming. But, now, in this slowdown, almost all airlines are struggling to remain afloat and AI is seeking a bailout from the government to survive. Nearly 45 of the ordered planes have already joined the Maharaja's fleet.

A highly placed government official said: "The airline has so far not come up with any concrete or credible plan that shows they have a road map to survive, leave alone emerge stronger. There is talk of AI seeking Rs 10-15,000 crore in support, clearing which is out of question. Being the national carrier we will hold its hand and support it." The Maharaja is going to seek soft loans and equity infusion from the government as it is finding it hard to even meet its working capital like paying salaries.

Top official added that given the airline's poor financial health and the fact that aviation industry is unlikely to see any drastic improvement in fortunes in a hurry, AI will be asked to take a relook at its fleet acquisition plan. "AI should realistically assess if its needs all the 111 ordered planes. It needs to see if some planes can be cancelled or at least deliveries pushed back," the official said. As per the original schedule, the new fleet delivery was to be completed by 2011.

The government is worried how AI would mobilize Rs 44,000 crore for these planes. It has given a sovereign guarantee to the aircraft manufacturers, which means that if the airline can't pay for any reasons, the exchequer will have to bear the burden.

Buzz is some of the future 777-300ER fleet may get hit.

AirIndia0001 · Member Joined: 28 Sep 2007 Posts: 391

It seems that ... either the top brass at Nariman Point do not have the power to take their own decisions ... or ... that they have got so used to being spoon-fed from Delhi that they habitually "wait for directions" on what to do next.

It is high time the govt brought in a professional management team to run AI. Honestly, these "babus-on-deputation" generally have a "do-not-care" attitude. It is too much to expect them to come up with a road map for survival.

karatecatman · Guest

(Thanks to source)

Mr. Jadhav had a day-long meeting with the unions.
Leaders of Air Corporation Employees' Union (ACEU), Aviation Industry Employees' Guild (AIEG) and Indian Aviation Technicians Association (IATA) suggested that many staffers were ready for transfer to low cost subsidiary Air India Express with lower salaries while others were ready to accept leave without pay for two years.

There were also many suggestions about the fleet.

But in all likelihood, the GoI may give in and accept almost all AI demands.

Nimish · Posted: Sun Jun 21, 2009 11:41 pm Post subject:

shivendrashukla · Posted: Mon Jun 22, 2009 7:29 am Post subject:

AI looks to beat turbulence

Already struggling to stay afloat, downturn dealt a final blow

karatecatman · Guest

(Thanks to source for this):

Air India letter:
June 20, 2009

RISE TO THE CHALLENGE AND MAKE AIR INDIA FLY HIGH AGAIN : CMD AIR INDIA

The current financial crunch being faced by Air India needs to be viewed in the global context as the aviation industry worldwide has been passing through turbulent times. All airlines in India and abroad have been experiencing low fares, poor load factors, drop in premium travel, decline in cargo loads and low yields due to market conditions created by global recession. To tide over the situation, all airlines have been forced to take harsh and unpleasant decisions like curtailment of capacity, withdrawal of flights from certain routes, retrenching staff, reducing emoluments, etc.. This has been stated by Mr Arvind Jadhav, Chairman & Managing Director, Air India, in a communication to employees today.

Mr Jadhav said that Air India employees have thus far not felt the impact of problems confronting the aviation industry because employees have been receiving their wages/salary and PLI month after month even when people in the industry in India and abroad have lost jobs or seen their emoluments take a dip. We should therefore consider ourselves fortunate that we have been insulated from the adverse impact of the economic meltdown so far, Mr Arvind Jadhav, Chairman, Air India, added in his message to the employees.

He has also drawn their attention to steps taken by other airlines worldwide to lessen the impact of the current crisis and how their employees have been affected:

(Source: Media reports and information from Airlines Personnel Directors’ Conference)

1. Singapore Airlines : Pilots have agreed to one day’s compulsory unpaid leave per month; Similarly Managers and Administrative Officers are taking one day a month either as unpaid leave or from their annual leave. Two Unions – SIA Staff Union and the airlines Executive Staff Union have accepted the Shorter Work Month Scheme. 50 Cargo Pilots are on unpaid leave;
2. British Airways: The airline has frozen pay and cut around 2,500 jobs since last year. BA has also axed 500 senior managers in December 2008. The airline is seeking 4000 voluntary redundancies, besides asking the employees to work for free for one month.
3. Cathay Pacific : The airline has asked all its 17,000 employees to take up to 4 weeks of unpaid leave in the coming 12 months while simultaneously reducing passenger and cargo capacity by 8 and 11 per cent respectively;
4. Japan Airlines has announced plans to cut 1,200 jobs by March 2010. The airline is also minimizing refilling of posts by improving productivity.
5. American Airlines will cut up to 1,600 positions by August 2009 and reduce capacity by 7.5 per cent;
6. Delta Airlines is planning to eliminate jobs besides cutting capacity due to recession, decreased demand and rising oil prices. Delta has already cut its workforce by 6.5 per cent since February 2008
7. AF – KLM are planning to cut between 2,500-3,000 jobs in the next two financial years. The airlines have cut 2,400 jobs in the financial year ending March 31, 2009.
8. Qantas will cut five per cent of its workforce including 500 additional Management positions and up to 1250 full time operational position in Australia;
9. In India, Jet Airways has put a freeze on recruitment and reduced benefit of Executive and Management salaries. The airline has terminated 50 employees on contract and 60 probationary cabin crew. Salaries have been reduced for other employees;

Mr Jadhav has further stated that as loans from financial institutions at high rates of interest cannot be availed of endlessly to meet working capital expenditure, the time has come for us to face the moment of truth in Air India as well. Air India has not resorted to retrenchment or layoff of staff till date. Air India has only decided to defer the salary and PLI for the month of June 2009 by 15 days. Executives at the level of General Manager and above have been requested to voluntarily forego their salary/allowances/PLI for the month of July 2009.

Air India has approached the Government of India, as the owners of our airline, for infusion of funds both by way of equity and soft loans. We are hopeful that the Government of India will extend a helping hand soon. However, as we have seen in the United States, financial help from the Government comes with conditions attached. Two major newspapers, The Times of India and Business Standard have editorially counselled the Government of India to go for disinvestment/privatisation of Air India instead of offering a bail-out package. We need to be conscious of the impact that disinvestment/privatization can have on our lives, should this materialize.

This is an hour of crisis for all of us. It is a fight for survival. The survival of our own Airline. I am looking for every single employee of our airline to rise to the challenge and demonstrate that we not only have more experience in running an airline as compared to others but also have the ability to overcome the crisis and emerge with flying colours. The experience and commitment to the Company will be of no gain, if we cannot demonstrate this. We have to show our critics that all of us can make Air India fly high again!

Meanwhile, Air India’s Human Resources Department has initiated a dialogue with the Unions to apprise them of the difficult financial situation confronting the airline industry in general and Air India in particular. While a meeting with some unions was held yesterday, another meeting with unions was held in Delhi today.

Mumbai
June 22, 2009

karatecatman · Guest

http://in.reuters.com/article/topNews/idINIndia-40507120090622
Air India looks to cut employee costs by 5 bln rupees
Mon Jun 22, 2009

MUMBAI (Reuters) - State-run Air India, which is grappling with a liquidity crunch, is looking to cut employee costs by 5 billion rupees annually, it said on Monday.

Air India's employee cost is currently more than 30 billion rupees.

"Besides reduction in wage cost, Air India is also looking at improving productivity of employees, elimination of restrictive work practices and reducing wasteful expenditure," it said in an e-mailed statement to Reuters.

The carrier, which has not laid off any employees, has constituted a four-member committee to examine the wage agreements, including flying allowances and productivity-linked incentives. The panel will submit its report by July 15.

Air India's chairman and managing director Arvind Jadhav has asked senior employees to forego salaries and incentives in July.

The cash-strapped airline has approached the government for infusion of funds both through equity and soft loans.

An initial public offering of shares in the firm could be considered in the near future, India's aviation minister had said earlier this month.

The Indian aviation industry has lost about $2 billion on an operating level in FY09, hurt by high jet fuel prices and weak demand due to the global financial meltdown.

karatecatman · Guest

Aseem · Member Joined: 15 Dec 2006 Posts: 2841 Location: YYZ

karatecatman · Guest

747-237 · Posted: Mon Jun 22, 2009 6:43 pm Post subject:

sammyk · Posted: Mon Jun 22, 2009 6:51 pm Post subject:

I think it affects freight as it takes up belly space.

karatecatman · Guest

sammyk · Posted: Mon Jun 22, 2009 8:02 pm Post subject:

Do the current 77Ls already have these tanks or is this the first one to get it?

karatecatman · Guest

747-237 · Posted: Mon Jun 22, 2009 8:40 pm Post subject:

Here she is :

AirIndia0001 · Member Joined: 28 Sep 2007 Posts: 391

Pardon my ignorance but what is the point in equiping AI's 77L's with further enhanced range capabilities in exchange for seats and cargo capacity.
What benefits do these 77L-ER's bring to AI as opposed to their existing 77L's.. especially when the current crop of LR's are fully capable of flying most of the workable India-US routes non-stop anyway!

jasepl · Member Joined: 26 Jul 2008 Posts: 4257 Location: bund-bay

I was quite amused to hear PP on the news today. Paraphrasing here... He declared that 'bailouts' as a concept don't exist in our system. However, AI, being state-owned (and state-destroyed) will get some sort of assistance. The loudmouthed egomaniacs, on the other hand, need to fend for themselves.

Anyone else catch the clip?

karatecatman · Guest

Update (Thanks to source)

Six high-powered committees have been formed to revive Air India. Unions have been assured that their representatives will be on these panels.
The six are:
Cost Rationalisation Committee
Committee on Green Initiatives
Committee on Integration
Committee on Safety
Committee on Customer Feedback and
Committee on Route Rationalisation.
One member of each union will be included in each (about 8-11 unions)

Union suggestions are also being included to revive the airline.

The meetings have also taken note of a sustained media campaign to run Air India down. Most notable of these is the Times of India group.

Nimish · Posted: Tue Jun 23, 2009 4:44 pm Post subject:

Perfect - when you've no money to pay salaries, set up 6 committees with union members all over - and hope that the govt will pay the bills!
_________________
We miss you Nalini!

karatecatman · Guest

Update 1
A four member committee has also been formed to urgently study and submit a report by July 15th on the wage agreements, including flying allowances and productivity linked incentives, entered into between the management and unions, associations (ground staff and cabin crew) and guild (pilots).

A plan to revive the airline will also be submitted to the PMO through PP who is returning to India from France soon.

Prime Minister's Office is also monitoring the situation.

nadarji · Member Joined: 11 Jan 2007 Posts: 305

Hopefully, this crisis will get the unions to buy in on the need for integration of the 2 carriers.

Anybody knows which routes make money, and which are bottomless pits?

Making AIExpress stand alone might come back to haunt AI now, since the Gulf routes cannot be used to cross subsidize other operations now.

karatecatman · Guest

ECONOMIC TIMES
Air India makes presentation to govt before Budget
23 Jun 2009
PTI

NEW DELHI: Cash-strapped Air India on Tuesday made a presentation before Civil Aviation Minister Praful Patel as part of its efforts to seek a
financial package from the government to bail it out of a major resource crunch.

The national carrier, which is working on plans to cut cost on employees by at least Rs 500 crore, came out with several proposals to enhance savings over the next few years. The airline's cost on its 31,000 employees currently stands at around Rs 3,000 crore per annum.

The presentation made by Air India CMD Arvind Jadhav, which lasted almost three hours, was attended by Patel and Civil Aviation Secretary M Madhavan Nambiar among others.

Jadhav is understood to have briefed Principal Secretary to the Prime Minister T K A Nair yesterday on the airline's financial position, apart from its growth plans for the next few years.

All officials were tight-lipped about today's meeting, which came less than a fortnight before the presentation of the general Budget amid expectations that the government may take some steps to ease the national carrier's financial problems.

Air India has already approached the government for urgent infusion of funds by way of equity, soft loans and grant.

***

CITU open to support Air India employees
June 23,2009

Kolkata , June 23
CPI(M) trade union wing CITU today said, if was approached, it would support any agitation by the Air India employees, who are currently facing the possibility of having their June month&aposs salaries delayed.

"Though, we do not have presence among Air India employees, we are open to support (them)," CITU state secretary Kali Ghosh said here today.

On the proposal for wage cut in AI, he said, CITU was opposed to it.

Air India had said that June month&aposs salary to its 30,000 employees could be delayed by 15 days due to a money crunch. The flagship carrier also came out with a proposal to cut the wage bill by Rs 500 crore.

karatecatman · Guest

LIVE MINT
Loss-hit Nacil may now seek up to Rs15,000 crore bailout

How it’s arrived at this figure is not clear but it may seek the funds in instalments—at least 25% of this immediately
Tarun Shukla
New Delhi: Buffeted by increasing losses, state-owned National Aviation Co. of India Ltd (Nacil), which runs the Air India service, plans to seek up to Rs15,000 crore in bailout funds from the Union government, nearly four times the amount sought last year and far more than what the ailing firm had pitched for as late as Monday.
A final decision on the extent of funds to be sought was not taken at a Tuesday meeting aviation minister Praful Patel held with Nacil’s chairman and managing director Arvind Jadhav, aviation secretary M. Madhavan Nambiar and senior Nacil executives. But a senior government official said it would likely be more than the Rs9,500 crore the airline has been asking the government for in presentations made to top officials since Saturday.
Seeking aid: An Air India aircraft at New Delhi airport. Air India has proposed cost-cutting measures, termination of aircraft leases, possible deferment of plane deliveries and restructuring of aircraft loans. Ramesh Pathania / MintThat amount was based on the airline’s estimate of its working capital requirements and almost double the Rs4,000 crore the airline was lobbying for last year.
It was not immediately clear on Tuesday how Nacil had arrived at the Rs15,000 crore amount but the official said it was likely that the airline would ask the government to disburse the funds in instalments, starting with at least one-fourth of the proposed amount to tide over immediate funding troubles.
Nacil’s accumulated losses had mounted to Rs7,200 crore as of end-May, according to a funding proposal prepared by the airline in recent weeks, with losses of Rs600 crore in April and May alone. This exceeds the earlier estimates of the national carrier’s losses pegged at Rs4,000 crore.
Airline firms in India have lost around $2 billion (Rs9,780 crore) in the last fiscal, and global industry grouping International Air Transport Association says India’s carriers are likely to contribute around a quarter of the $9 billion projected industry loss this fiscal even though they make up for just 2% of the passenger traffic.
“The airline, along with the civil aviation ministry, is looking at measures to bring about reduction of costs and improve revenue generation. (The) government is also looking at various options of assistance to help the airline come out of the financial crisis,” said a second senior government official, who too asked not to be named since a final decision on the bailout is pending.
The government owns Rs145 crore in equity in Nacil.
Nacil’s finances have deteriorated in recent years as aircraft purchase costs (it has some 66 planes on order from Boeing Co. and Airbus SAS until 2014) and related financing charges have risen sharply at the airline, on the one hand, and pressure on revenues and profits increased, on the other, as it faces competition from other airline rivals domestically and internationally.
According to the Nacil proposal presented, and reviewed by Mint, the airline’s working capital requirement had increased to Rs16,300 crore as of end-May, from Rs2,369 crore on 31 March, 2006. This exceeds Nacil’s provisional revenues of Rs15,000 crore for fiscal 2009, up from the equivalent of two months turnover in fiscal 2006, when sales were Rs14,600 crore.
To press home the urgency of its financial situation, Nacil’s Jadhav and aviation secretary Nambiar met cabinet secretary K. M. Chandrasekhar on Saturday. This was followed on Monday by a meeting that Jadhav and Nambiar had with T.K.A. Nair, principal secretary to the Prime Minister. In both meetings, a bailout amount of Rs9,500 crore was discussed.
Besides government funding, Air India has proposed cost-cutting measures within the airline, termination of aircraft leases, possible deferment of plane deliveries, and restructuring of aircraft loans.
On Monday, the airline said it aimed to reduce wage costs by Rs500 crore, or 16%, this fiscal.
The government funding, Nacil has suggested, can be infused through redeemable preference shares or zero interest convertible debt. Such preference shares can be redeemed at a premium if there’s a future capital induction from non-government sources in future, it added.
The airline also wants that induction of planes in future—for which it requires Rs15,000 crore—be supported by sovereign guarantee and fully co-ordinated by State Bank of India.
Structuring such loans over two sequential periods—first, backed by guarantees of export-import banks from the country of the plane vendor, and, second, guaranteed by the government—will make for a loan tenure of 15 years with a three-year moratorium easing pressure on cash flows in the medium term, Nacil added.

Manny · Member Joined: 10 Feb 2007 Posts: 292

karatecatman · Guest

INDIAN EXPRESS
In crisis, Air India wants it all: Let us live, let others die
Pranab Dhal Samanta
Wednesday, Jun 24, 2009

New Delhi: With Air India caught in a financial tailspin, Civil Aviation Minister Praful Patel will meet Prime Minister Manmohan Singh to work out the contours of a long-term revival strategy including government financial support to overcome some of the current difficulties.

While discussions now move to a higher level after Patel’s two-hour review meeting with officials today, the political leadership is stunned by the demands Air India has made of the government.

The airline has drawn up a bailout package of about Rs 15,000 crore — Rs 5,000 crore as equity infusion and the rest as soft loans. This, sources said, would be cut by at least half to a total package of about Rs 5,000-7000 crore — that too, if the PM is convinced.

Some other demands are even more difficult to meet.

At a meeting with the PM’s Principal Secretary T K Nair and Cabinet Secretary K M Chandrasekhar, Air India demanded that sixth freedom rights to all foreign airlines be reviewed. This essentially allows foreign airlines to operate to multiple destinations within India. Already, the Civil Aviation Ministry is exercising greater caution with fresh requests, but sources said it would be impossible to simply abrogate rights settled through bilateral agreements with other countries.

The airline wants a freeze on capacities of foreign airlines so that Air India gets some breathing space. This would mean no further negotiations on air bilaterals to improve capacities and services by other carriers. It has also asked that private domestic carriers should be advised to give up their “surplus” route entitlements, particularly in revenue earning sectors like the Gulf so that Air India can gain.

It’s learnt that these suggestions have not gone down well with the political leadership, as this approach tends to not only undermine other carriers, but actually works on the old assumption that air bilateral agreements must be suited to Air India rather than be based on passenger demand.

It was suggested at the meeting that the Air India Board of Directors be strengthened by enlisting members who are experts in finance, law and hospitality in the initial phase. A rejig of the current board is also not being ruled out in the near future.

As Patel prepares for his meeting with the PM — possibly tomorrow — sources said a decision on lending any kind of government financial support will have to be based on a long-term plan for disinvestment of the airline. It’s learnt that the Civil Aviation Ministry is not averse to divesting up to 49 per cent stake over a period of time in the airline. However, any movement in this direction will depend on the PMO’s approach.

The current crisis in Air India is accentuated by the fact that it is overstaffed by about 50 per cent. Much of the surplus was to be absorbed by way of fresh ventures after the merger like setting up cargo operations and MROs that would add to revenues. But the merger has not moved smoothly, adding to the trouble.

In going ahead with its fleet augmentation programme and daily expenditure, the airline’s working capital is a little over Rs 16,000 crore — more than the financial turnover of the company, which stands at approximately Rs 15,000 crore. The market share of the airlines has declined by 9 per cent in the last three years in the domestic sector and by about 5 per cent in the international sector. The estimated losses of the merged Air India stands at about Rs 7,200 crore at the end of May. This, sources said, is in itself irregular for any bank to give loans, and thus the cry for financial relief.

The airline hopes that some measure of financial support from the government will help improve its position to attract more loans to tide over the crisis. While there may not be many options for the government, except for negotiating the amount, it is clear that a long-term view will have to be taken for the airline.

At present, some of the other suggested measures include:

• Reduction in productivity linked incentives (PLI)

• Return of leased aircraft, and to operate on only owned aircraft.

• Making it compulsory for government servants to fly only Air India

• Review of all AI’s operational agreements.

While this happens, salaries for the month of June have been deferred by two weeks for all middle-level and senior employees. In many ways, this move also helped draw attention to the deepening crisis in the airline — one which had prompted the government to change the Air India CMD in the middle of the Lok Sabha elections.

PMO also to blame as it followed and pushed hard for the merger even though there were several warning signals.
All of us will remember the dramatic annoucement by PP outside South Block.

karatecatman · Guest

HINDUSTAN TIMES
Dhoni to get delayed salary
New Delhi, June 24, 2009

MS Dhoni’s salary will be delayed next month. Ditto VVS Laxman, Harbhajan Singh, Yuvraj Singh, Suresh Raina, S. Sreesanth and R.P. Singh. Reason: These India cricketers are among the 200-odd sportspersons employed by Air India. Also on the list are India hockey captain Sandeep Singh and Jhulan Goswami who captains the national women’s cricket team.

“Frankly, we are still not clear on the status but yes, the salary has been deferred by a fortnight,” said Shekhar Guha, head of Air India Sports Promotion Board. An Air India hockey coach, who didn’t want to be named, also said: “By the 20th of every month we get PLI (Performance Linked Incentive), but we have not got it till now and there are rumours that we won’t be paid at all.”

Some of the big names mentioned above may not be affected by this but for sportspersons, present and former, surviving only on salaries this is a big blow. Neither Raina nor Sandeep, a deputy manager, said they knew about this. “I have been hearing about it in the news, but I wasn’t sure if it was going to happen. I will have to speak to my coach,” Raina, assistant manager, Commercial, said. Sandeep, however, felt if they did not get the salary on time would be a big problem.

Former India wicketkeeper and Delhi coach Vijay Dahiya said he would be hit by this but added that since “Air India takes care of its employees and this is a crisis, I urge all my colleagues to stand by it.”

In Mumbai, Bimal Ghosh, coach of the Air India football team which plays in the I-League, said training hasn’t stopped despite the announcement.

Company spokesman Jitender Bhargava said sportspersons, if hired as permanent staff, are usually recruited as assistant-managers. Their educational qualification too matters, he said. “We don’t employ sportspersons as brand ambassadors, but spot them young and groom them. So, their salaries are not higher than that of the top level managers,” he said.

As of now, the loss-making airline has formed a four-member committee comprising members from finance and personnel departments to look into its salary structure. Air India employs 31,000 people and has an annual wage bill of about Rs 3,000 crore. Its cumulative loss is about Rs 5,300 crore.

Air India has an annual sports budget of approximately Rs 4 crore and officials said, as of now there are no plans to curtail that.

Add to this list Dhanraj Pillai, hockey champ, who it seems is cabin crew. (This needs to be verfied though)

vivekman · Member Joined: 26 Dec 2006 Posts: 1897 Location: BOM

Air India in BIG trouble!

US lawsuit against Air India for violating aviation laws

http://timesofindia.indiatimes.com/Business/Multi-million-dollar-lawsuit-against-AI/articleshow/4695773.cms

karatecatman · Guest

karatecatman · Guest

http://money.cnn.com/news/newsfeeds/articles/djf500/200906240235DOWJONESDJONLINE000272_FORTUNE5.htm
Air India: Awaiting Information From Boeing On 787 Delivery

June 24, 2009
MUMBAI -(Dow Jones)- Air India, the nation's flag carrier, said Wednesday it is awaiting an official communication from Boeing Co. (BA) on any possible impact on deliveries of the 787 Dreamliner plane because of the delay in the first flight of the new passenger jet.

Boeing has postponed the first flight of its next-generation aircraft, scheduled to occur by the end of this month, due to structural problems that could hamper maneuverability.

"We have not got a communication from Boeing yet," Jitendra Bhargava, executive director for corporate communications at Air India, told Dow Jones Newswires by phone. "It is difficult to say anything since their announcement only talks about a delay in their first flight. It does not mention the time of delay."

Structural problems that could hamper maneuverability?!!
Boeing says that it's a minor issue!

karatecatman · Guest

TIMES NOW TV
Praful Patel to brief PM on Air India crisis
24 Jun 2009
Prime Minister Manmohan Singh summoned Civil AViation Minister Praful Patel on Wednesday (June 24) to review the ongoing Air crisis over the airline's financial position. The meeting has been scheduled for 4:30 this evening. Patel will brief the Prime Minister on the the crisis.

The meeting between the PM and Patel comes less than a fortnight after the Air India trade Unions threatened to go on strike if their salaries were not paid on time. The airline had earlier announced that it will defer salary payments to employees for the month of June. In addition it has also asked top management to surrender one month's salary.

While talks with the unions have begun, the union members are sticking to their agitation programme announced
earlier and have started wearing black badges to protest the decision to delay the payment of this month's salary by a
fortnight.

The management has also asked the airline top brass, General Managers and above, not to take their July salary.

Air India has demanded a Rs 10,000 cr bail out package from the govt to tide over cash crunch.

Air India made a presentation before Civil Aviation Minister Praful Patel on Tuesday as part of its efforts to seek a financial package from the government to bail it out of a major resource crunch.

The national carrier, which is working on plans to cut cost on employees by at least Rs 500 crore, came out with
several proposals to enhance savings over the next few years. The airline's cost on its 31,000 employees currently stands at around Rs 3,000 crore per annum.

The presentation made by Air India CMD Arvind Jadhav, who reportedly briefed Principal Secretary to the Prime Minister T K A Nair yesterday on the airline's financial position, apart from its growth plans for the next few years.

Air India has already approached the government for urgent infusion of funds by way of equity, soft loans and
grant.

karatecatman · Guest

Update (Thanks to source)
Specific union demands:
Probe into management’s decisions on aircraft selection and leasing and acquisition.
Probe into "gifting of bilateral rights" to foreign air-carriers and the so-called open-sky policy.
Reckless sale and transfer of Air India and Indian Airlines land assets in Kalina and Sahar (Mumbai) to private developer, Mumbai International Airport Limited, on a platter for construction of 5-star hotels and offices in the name of airport development.
Probe into payment of Rs.40 arrears to senior engineering executives just 10 days before the announcement of deferment of salaries to staff.

(Shiv Sena backed) Unions also want direct intervention by the Prime Minister and a thorough probe by a Joint Parliamentary Committee (JPC) in Air India affairs.
Shiv Sena Rajya Sabha MP and Air India union leader Bharat Kumar Raut has said the government should appoint either a JPC or a Parliamentary Committee to look into the problems that Air India is facing.
The Unions that want the PM's direct intervention are the All India Cabin Crew Association, Air India Employees Union, Air India Service Engineers Association, All India Executive Cabin Crew Association and Bharatiya Kamgar Sena-Indian Airlines. All these unions are under one branch called the Federation of NACIL Employees (FONE).

Nimish · Posted: Wed Jun 24, 2009 6:52 pm Post subject:

iah87 · Member Joined: 17 Apr 2007 Posts: 2566

I have bright idea to stop AI from losing more money. If they cease services tomorrow, they may actually lose less money !!! Laughing