The Hindu Business Line : Air India, IA working on greater synergy options

IN the wake of impending competition in the domestic and international skies from the private sector airlines, Air India and Indian Airlines are exploring greater synergy options, including sharing of manpower and creating common infrastructure.

Official sources told Business Line that the broad contours of bringing about synergy between the two airlines would be firmed up soon. The airlines will look at synergy in various departments including examining the possibility of working together in diverse fields such as commercial services, ground handling and the engineering department.

If the airlines are eventually able to achieve greater synergy, the move could help reduce costs for both.

The move comes close on the heels of the Union Cabinet calling for establishment of improved operational synergy between AI and IA. In December last year, the Union Cabinet, while allowing private sector airlines to start operating flights to more foreign destinations, also felt that AI and IA would both gain by synergising their operations.

While officials of the two airlines from various departments have held meetings in both Delhi and Mumbai, a final decision on this will be taken after a meeting between the chiefs of the two airlines.

"We will try and achieve synergy between the two airlines at the earliest. Synergy does not mean that we cannot compete with one another. Competition is good for business," a senior airline official said.

"While the two airlines could be allowed to operate flights to certain destinations around the globe, there will be other routes which may be specifically earmarked for one airline alone," a senior Government official indicated.

In an effort to ensure that both the airlines can make use of the growing opportunities in the international market, AI and IA are looking at acquiring new aircraft.

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