Ashwani Lohani, CMD, Air India shared a roadmap for the national carrier, outlining that consolidation and expansion were being undertaken in equal measure. He shared that Air India was going to add 100 new aircrafts, both, wide-bodied and ATRs, with an eye on ramping up domestic and international connectivity. Excerpts of his speech at 5th Update & Outlook Meeting, PATA India Chapter in the capital recently.
Consolidation part of expansion
CMD, AIR INDIA
Airlines and tourism go hand-in-hand. The role of Air India, in that context, becomes very important for international and domestic tourism. I do not say we do not have issues. We at Air India still have a lot of issues which need to be resolved and most of these are basically legacy issues. There were two different carriers, one was an international carrier, another was a domestic carrier and we merged them in 2007 – resulting in a lot of issues. We started going downhill very fast, cumulating a lot of losses. There were compatibility issues between the staff of Air India and Indian Airlines, but we are at it. We want to settle all these issues, but it is not as easy as it looks.
There are merger related issues and the debts we have got, but we are at it and trying to solve both, and hopefully, god willing things will improve. We are looking at consolidation and expansion, both – and personally think that consolidation is a part of expansion. I cannot wait to set right the existing routes and then think of adding new routes, but we will do both at the same time.
Copenhagen, San Francisco, Vienna and Tel Aviv new destinations on
the radar
In the last one year, between 2nd December 2015 and the 1st December 2016, we added four new international flights, and four is a big number for any international carrier anywhere. We flew San Francisco, firstly, thrice a week, expanding it to six times a week. We are flying to Vienna. Also, Ahmedabad to London and Newark – and the last addition was Delhi-Madrid from the 1st of December. We want to expand further. We have got a couple of aircrafts coming in – some 787s are arriving, beside some 777s in the first quarter of 2018, and we plan to fly to six new destinations in 2017.
We plan to go to Washington, Toronto, Tel Aviv, Stockholm or Copenhagen, some destination in Africa; we plan to fly to Frankfurt from Mumbai, and a lot of flights from A-320s to nearby destinations. We are also looking at getting, apart from the eight aircrafts which are yet to come, at least five more wide-bodied aircrafts, if not more.
Air India to induct 100 new aircrafts by 2020; domestic tourism set to gain
On the domestic front, one of the problems we have is the old fleet. While they are safe, as in airlines you cannot compromise with safety. They are as safe as any other airline carrier, but comfort-wise and cabin systems-wise we have to retire these aircrafts. We have plans to add 14 new aircrafts to our fleet in 2017. We have ordered for 22 new aircrafts right now. The basic plan is to induct 100 new aircrafts between now and March 2020 to the Air India fleet, taking it from 132 to 232 aircrafts. So, we are planning to fly on a number of new destinations, and are also very aggressively at the ‘Connect India’ program of the ministry of civil aviation, the regional connectivity plan. We have 8 ATR-72s and 2 ATR-42s will go up to 23 ATR-72 by December 2017. We are going to add 15 aircrafts – and we will fly almost everywhere.
We want to take a flight to Jaipur, Bikaner, Jaisalmer. We want to get a couple of planes to Bhopal and fly to nearby destinations like Jabalpur, Gwalior. Similarly, for Maharashtra and Karnataka we want to make Hyderabad or Bengaluru as our base. All this will happen in 2017. 2017 will see the turnaround of the Alliance Air. This was a small airline and a bit neglected, but I have full confidence that in 2017-18, Alliance Air should be able to post a profit.
We are looking at some unique flights as well. Like, in the month of January, we are going to start a flight from Kolkata in the morning – which will go Raipur and then fly to Indore and then to Ahmedabad, heading then to Jaipur and landing at Delhi in the evening. It will be the first garland flight of India.
There are a lot of other connections. We are flying to Uttrakhand, to Pantnagar. An airport in Pithoragarh is coming up very shortly. So, we will fly from Pithoragarh to Lucknow and other places.
Airlines a tough business, yet Air India hopeful of posting better profits
Airlines is a tough business. It is not like running hotels. Running hotels is a very easy job. I ran ITDC in the past and in hindsight I can say that it was child’s play. We posted an operational profit of 105 crores last year. It only means one thing that, on a year-to-year basis, we have been able to recover the cost that we incur. The revenue is marginally over 20,000 crores. This year we hope that this operating profit will go up by a couple of hundreds of crores. But we still have a big battle ahead, but we are looking at it, looking at restricting on finances and all of that.
Air India working on improving services on-board
Service was an issue. The catering service, as well as reservation service has considerably improved; we have moved forward on that count. We still have a long way to go but about a year ago, we had a lot of negative feedback every day, right from the morning to the night. Now, we have started getting positive feedback as well. We have improved our food, we have put a lot of emphasis on that count. It is one of our USPs. After all, we are not a LCC but a full-service carrier. We have started giving higher baggage allowance, if one converts that into money terms, that means an extra of `2,000. Then we become the cheapest airline; we are cheaper than LCCs. We are a lot more competitive. Our punctuality has also considerably improved.
Expansion will boost domestic and international tourism
We will continue to grow and continue to expand. We know that we have to connect India within itself, and we have to connect India with the rest of the world – which amounts to international tourism. We have to connect state capitals with each other – which will boost domestic tourism.
We are open to suggestions and ideas. But we want to fly profitably. So far, whatever we have started on the basis of the mandate provided to us, or perhaps on the basis of the gut feel have all been doing well. We have 13 wide-bodied aircrafts coming to us in the next two years. That means, at least, 13 more destinations.
Air India finds itself at the receiving end of a dubious survey, hits back to discover it is unsubstantiated
An international flight data firm, FlightStats put out a list of best and worst airlines in the world – and declared Air India as the third worst airline in the world. The survey does not merit any attention as it remains unsubstantiated.
Air India has strongly contested the data shared and the veracity of the report. Air India said that it had a consistent good record for the last two years of having clocked an OTP (On Time Performance) of over 78% on its domestic and international network. AI is a network carrier which is presently connecting 72 destinations within India and 43 destinations abroad through its hub in Delhi. It was emphasised that the OTP of Air India ranked at par with its competitors in the domestic sector taking into consideration the fact that Air India operated to every corner of India where there were several infrastructural constraints like sunset limitations and weather conditions affecting schedules. On international sectors, too, Air India’s OTP was in no way could be termed poor, going by the sheer volume of its operations to most international stations. Air India also ranked amongst the top 10 carriers in terms of on-time performance amongst the carriers in the prestigious Star Alliance consortium of airlines.
The data published was apparently based on unconfirmed information and was directed at misleading the customers and audience at large. The report had clearly targeted Air India and its image. The way the report had been compiled and projected would make one believe that some vested interests might have been at work to tarnish the image of the national carrier of India which has been performing well in recent times and even reported an operating profit of Rs.105 cr in the last financial year. The report has been made public at a time when Air India has just announced major expansion plans by way of induction of fleet and commencement of new international and domestic stations. And, this had also lead one to speculate on the intentions behind the entire exercise. Air India said it would take very strong action and leave no stone unturned to ascertain and bring to light any biased or malicious intent to spoil its image.
TourismFirst gathers that the unexpected and equally strong reaction from Air India did not evince sufficiently valid arguments. TF believes not much attention needs to be given to this evaluation and it is best put behind us.
