As Air India struggles to pay salaries on time, over 20 officials of the state carrier are in France and the US to take delivery of three brand new aircraft.
As Air India struggles to pay salaries on time, over 20 officials of the state carrier are in France and the US to take delivery of three brand new aircraft.
Officials have left for Toulouse and Seattle to finalise the purchase of a Boeing 777 for Air India and two Airbus aircraft (A-320) for Indian Airlines, Nation Aviation Company of India Limited (Nacil) sources told DNA. The aircraft will be flown to India sometime this week.
“On the one hand, Nacil CMD Arvind Jhadav is struggling to get the Rs15,000 crore bailout package from the government, while on the other hand, Nacil officials are in Seattle and Toulouse witnessing the pre-delivery checks of the aircraft,” Nacil sources said.
However, Nacil officials in Mumbai and Delhi are displeased with the management’s decision. “It is strange that the management would not defer the delivery of the aircraft, but rather delay the salaries of over 40,000 employees,” a senior Nacil official said.
The national carrier has 150 aircraft, the largest fleet in the country. It had placed orders for 111 new aircraft (68 Boeing and 43 Airbus) in 2005 at an estimated cost of Rs45,000 crore. Four more aircraft Boeing 777 will be delivered this year.
Ironically, despite Nacil’s financial mess the management insists it will continue with the fleet expansion plan process.
While the economic meltdown has forced airlines worldwide to defer the delivery of new aircraft, Nacil officials and civil aviation minister Praful Patel seem to be unaffected by the prevailing crisis. “The airline needs new aircraft. It can’t fly passengers in old aircraft and compete with other airlines which are flying passengers in brand new aircraft,” Patel said.
Jhadav, however, said, “The delivery cycle can’t be changed as the airline would then have to pay a hefty penalty.”
But some Nacil officials claim the management’s decision lacks “business sense”. “No airline’s business model would approve fleet expansion especially when the passenger load is plummeting, fuel prices are going up, and most importantly, when the basic working capital is hitting rock bottom,” a senior Nacil official said.
Nacil sources claim the new aircraft delivery will adversely impact the already cash-strapped national carrier. “I’m surprised no one is talking about the high operational costs in both the international and domestic sectors. Why is the management ignoring factors such as fuel prices, passengers load and slump in the aviation market?” a senior Delhi-based Nacil official said.
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