Air India board wants 70%+ load factor on domestic flights

The board of directors of Air India, which met on Tuesday, has set some stiff targets for the ailing airline, to improve its financial performance.

Among the new targets being pursued is increasing passenger load factors (PLF), on the fleet of narrow body aircraft used for domestic operations, to over 70% and try to reach the same level of aircraft occupancy in international operations as well.

The board, which now comprises eminent India Inc personalities such as Anand Mahindra, Amit Mitra, Harsh Neotia etc, is looking at achieving profitability this fiscal, it has already projected doubled fuel savings to Rs 532 crore in the next 18 months besides various other operational measures to cut costs.

Load factors have already improved over the last three months and in April alone, AI collected Rs 130 crore more than April 2009.

These measures follow the board’s decision to also completely restructure the airline’s debt and working capital requirements, through a mix of government’s equity infusion and comprehensive loan restructuring.

AI’s improved operational performance is already evident. Air India flew a record number of 50,308 passengers on its entire network-domestic and international stations-on May 16. Of this, 32,456 passengers flew on IC coded flights while the international passenger carriage by AI and AI Express flights totaled 17,852.

The carriage of 32,456 passengers on the IC network of flights is a record, achieved for the first time after the merger of erstwhile AI and IA. In May 2010, the airline has seen nearly 17% growth in daily passenger carriage year-on-year.

The average daily passenger carriage on the total AI was 45,900 for the first fortnight of May 2010 against 39,350 in May 2009. During April 2010, on an average, 44,000 passengers were flown on Air India flights against 36,750 in April 2009.

No wonder then that the carrier’s domestic market share rose to 18.2%, bringing it on par with other full-service carriers in this segment during May. On the international sectors, Air India and Air India Express together account for 24.1% of the market share.