Running Charges– Rs-3,000 crore/Year.
Operating Charges- Rs-1,500 crore/Year.
60% salary to upper management.
Rs-480 Crore wasted because India-newyork route , Plane was stranded in Newyork Airport from 11 to 14 hours and 41% income was wasted.
Rs-280 Crore was wasted beacuse plane was not used.
Rs-67 crore wasted on unnessary design.
Praful Patel demerged Air India & Indian Airlines in 2006.
1200 AirIndia Planes Only for Politicians.
In 2005, then Minister of Airline Praful Patel passed order of Rs-35,000 crore plane.
Government Buy 68 Boeing Plane from U.S.A. But actually required only 28 Planes & paid Rs-10,000 Crore.
Now AirIndia is in Rs-18,000 crore Debt. and Rs- 800 crore Per Month Loss.

Cash-strapped Air India had spent nearly Rs 41 crore in a year in maintaining its offices in 11 cities across globe even though it does not have any operations from these locations. The Air India in an RTI reply has accepted it has offices in Los Angles, Amsterdam, Milan, Vienna, Zurich, Moscow,Cairo, Tehran, Nairobi, Sydney and Chittagong but does not have flight operations at these locations.

One of the most startling policy decisions, and one that has certainly contributed to the mammoth hole that the National Carrier finds itself in, was the decision to merge the 2 carriers, Air India and Indian Airlines: the argument given was that this would allow an entry into the Star Alliance which it was promised would be the silver bullet to end all of the National Carriers problems.

• Fleet acquisition scam:——- Air India had made a request for 24 aircraft in the MCLR category (Medium Capacity Long Range) and even initially selected the Airbus A340-300. Indian Airlines on the other hand had wanted a total 43 new Airbuses to replace the existing fleet of Airbuses they already operated: that’s a total of 67 aircraft. The minister, for reasons best known to him decided that the number just wasn’t enough. So the actual order placed was for a whopping 111 aircraft, instead of the combined total requirement projected by both the airlines of 67. How could an Airline with a turnover of a little over 7000 crores place orders for aircraft costing over 32000 crores? The interest burden per year alone would come to 6000 crores!

32 Profitable Routes mainly in the Gulf and Singapore sectors which were going nearly 85-100% full were curtailed in the name of route rationalization and it’s no surprise to see that the AI / IC flights had been replaced, one for one, by Kingfisher and Jet, at exactly the same timings as the erstwhile AI / IC flights! On 12th October 2009, the management sent letters to station managers in Kozhikode, Cochin, Doha, Sharjah and Bahrain informing them of a decision to reduce or cut flights on these sectors. Other routes which saw exactly similar dynamics at work: Chennai-Colombo (just in time for Spice jet to start operations on the route), Kolkata-Bangkok (Kingfisher started barely a week after IC was made to pull out), Kolkata-Singapore and London-New York!

A management consultancy service was hired at a price of 90 crores to advise Air India on how they should restructure their operations. The contract was awarded to; hold your breath, Accenture Consulting: a company with close links to the UB and USL Groups which own Kingfisher, and which had previously worked on the acquisition of Air Deccan by Kingfisher!

This CMD has accused the pilots and the employees, for the Airlines losses a number of times; citing reasons that pilots/ employees repeatedly keep on going on strikes. Let it be known that during this CMD’s tenure which spans over a period of 2 years, the Airline has seen the most turbulent of times and gone through as many as four strikes. Despite 90% of flights having been cancelled, the CMD still continues to reiterate that he is managing to maintain services to facilitate the passengers.

The Five Boeing 777 and three Airbus’s 310 Aircraft which were taken on lease were on the ground with no Pilots to fly them. The loss incurred was 840 crore. Who is responsible for this faulty decision?

The Airbus Fleet has been under-utilized (used only) for 8.5 hours per day compared to a worldwide utilization for instance of 14 – 15 hours a day.

Three A310 were converted to cargo version at very high cost only to be  grounded/sold in a very short time

Foreign pilots have been hired by Air India and Air India Express at exorbitant salaries and that too in foreign exchange, when we are available to fly 90 hours a month which due to some of the reasons mentioned above has been curtailed to approx 45 hours a month. Why hire Foreign pilots (from specific agency owned by an erstwhile Director of Air India) when we are available?

Cabin Crew Shortage: In the name of reduction of work force, Cabin Crew in AIR INDIA were either sent on long leave or were given voluntary retirement. This created a shortage leading to delays and cancellation of several flights over the last one and a half years. No steps were initiated by the management to overcome this shortage. Why?

Land in Kalina, Mumbai: AIR INDIA’s 219 acres of land at Kalina, Mumbai, was a prized property and had great market value of around Rs 500 crore per acre the total value coming to 109500 crores(one lakhs, nine thousand and five hundred crore) nearly as big as the 2G scam. However, this land was gifted to MIAL. Why?

Official Residence of the CMD (Vasant Vihar, D1, New Delhi): Rent paid by AIR INDIA Ltd. and Hotel Corporation of India, collectively (rent is in Six figures). For a bleeding Airline does this make sense? The CMD wants to curtail passages given to the employees who serve their whole working life in the Airline. Why is it that the CMD and other Management staff and officials of this Ministry have given onto themselves and their families free passages not only during the tenure with the Airlines but for Life? How is it that Praful Patel before moving out of this Ministry gave onto himself unlimited passages for family and friends for life and the authority to drive onto the tarmac, up to the Aircraft, a privilege only extended to a select few as specified by the Government of India?

All the Property Deals of Centaur Hotels: Various properties of Hotel Corporation of India (Centaur Hotels) were sold to “tainted” firms, one such deal in under investigation.

Air Call Center and other conflicts of interest: Until 2009, the call center for Indian Airlines was being run by a firm called Omnia International. In 2009 however, a decision was taken, at the ministers behest, to award the contract to run the call center to, hold your breath, Interglobe Technologies (the parent company of Indigo Airlines) the main competitor to Indian Airlines! Imagine this: outsourcing your call center operations to be run by a competitor? Why?

There are 4 different wage/ allowance/ uniforms/ service conditions and agreements of all employees. Since 1st April 2007 (date of merger) Air India has not managed to implement one common agreement or one common code of conduct. What kind of merger is this? The erstwhile IA Pilots pay is linked to the number of hours they fly an aircraft unlike the AI Pilots who are paid a fixed salary which is far in excess of what the IA Pilot gets, for doing the same job and now in the same Airline.

Justice Dharmadhikari Committee was formed after the Strike notice of 23rd Feb 2011. The committee conducted its first meeting on 26th April 2011. It took the Strike Notice to form a committee, and a Strike, for the (Strike) Committee to meet. Further, which committee in India has finalized its report within stipulated time and does this require 5 months for a decision already taken to be implemented? Do you think the management is serious about resolving these issues?

The cost of interest payment per day is around 20 crores. Why did AI not take loans from the manufacturer at much lower rate? While ordering Aircrafts from Airbus and Boeing, MOU’s that were signed, their terms and conditions were changed in the final agreement? Why?

Protecting Tainted Officers: According to The Central Vigilance Commission the CMD protected a tainted officer Mr. P. Easwachandran of Hotel Corporation of India (HCI).

Why are some selected staff being reemployed after retirement? Does the CMD need a coterie around him to do his bidding?

• The Pilots, Engineers and other ground staff are the backbone of the Airlines. Why is it that the CMD is deliberately trying to break up the unions and associations and also targeting the executive pilots for, like Oliver Twist, daring to ask for parity in salary as promised? Are they also not pilots and flying aircrafts? What is most inexplicable is the adamant attitude of the Honorable Minister, who we look up to help resolve issues fairly and see what actually ails the Airlines and bring those responsible for this sorry state of affairs to book. Regrettably, he has chosen to go with the Managements draconian decisions and methods to grind the Airlines to the ground and not even listen to the plight of the core group of the Airlines.

  1. October 13, 2011 at 2:42 pm

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  2. October 14, 2011 at 1:49 pm

    I enjoyed that post. This topic is really very intesting.

  3. October 22, 2011 at 9:43 am

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  4. October 24, 2011 at 5:28 am

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  5. December 17, 2011 at 11:48 pm

    Some truly wonderful posts on this website, thank you for contribution. “Careful. We don’t want to learn from this.” by Bill Watterson.

  1. July 25, 2011 at 11:01 pm

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