A-I to revive its dipping fortunes with new aircraft

By SiliconIndia   |   Friday, 20 September 2002, 07:00 Hrs
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NEW DELHI: India's flag carrier Air-India is all set to fly to new destinations and expand its operations in a dramatic overhaul facilitated by its largest ever one-time fleet expansion.

The airline, caught in a virtual time warp with no new addition to an ageing and inadequate fleet since 1995, also plans to cater to emerging market needs and fight back foreign airlines that have weaned away a large number of customers.

Seventeen new long-range aircraft will join A-I's fleet of 28, following a decision by the A-I board Wednesday. Both France-based Airbus and the Boeing Company of U.S. are vying for the deal, worth around $ 2 billion.

"We are looking to provide access to more points, and have gateways other than Mumbai and New Delhi," an airline spokesman told IANS.

The airline also seeks to begin flying to foreign destinations such as Frankfurt and Rome, where it could not operate earlier due to shortage of planes.

"With our sizeable fleet, we will be able to exploit many unfulfilled bilateral agreements with other countries," the official added.

A-I has bilateral agreements with airlines of 96 countries, but it has been able to operate to only 47 because of inadequate fleet. Bilateral agreements give airlines the right to fly in each other's airspace.

After showing a profit of over 250 million in 2001-02 for the first time in six years, A-I has also decided to augment its fleet with short-range aircraft, but the plan is yet to be finalised.

The mixed fleet of new 250-seaters and 150-seaters would allow A-I to fly long distances to destinations such as the U.S., Europe and the Far East without long stopovers.

The airline, which suffered from heavy losses and had to cut down on many destinations due to the lack of planes, last purchased two aircraft in 1995. Two years before this, it added six Boeing 747-400s to its fleet.

Lack of funds and the government's bid to divest its shares in the airline stalled further purchase, and Air-India resorted to leasing aircraft.

The induction of new aircraft would begin from April 2003 and would be completed within the next five years, officials said.

The airline's technical committee will now finalise the purchase plan for short haul aircraft for foreign destinations, with around 160 seats in two classes.

With over 16,000 full-time staffers, Air-India has the largest employee to aircraft ratio in the world - 588. This has crippled its finances over the years. As new planes join the fleet, this ratio is expected to come down.

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