Business Daily from THE HINDU group of publications
Thursday, Jul 24, 2008
ePaper | Mobile/PDA Version | Audio
Business Daily from THE HINDU group of publications Thursday, Jul 24, 2008 ePaper | Mobile/PDA Version | Audio |
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Airlines Air India to cut routes, hopes to save Rs 500-600 cr Our Bureau New Delhi, July 23 In an effort to curtail mounting losses, Air India plans to reduce the number of flights being operated but has no plans to retrench any staff, a senior Government official said on Wednesday. The airline is now said to be reporting daily losses of between Rs 13-14 crore mainly on account of low passenger load factors, rising cost of aviation turbine fuel and increase in wage costs. Air India expects to post a loss of more than Rs 2,000 crore for the financial year 2008, which could rise substantially the following year unless remedial action is taken, official sources said. Flight reductionThe reduction in flights, Air India hopes, will help it save Rs 1,000 crore in a fiscal year, a senior Government official said. “The reduction in flights will happen on the network of both Air India and Indian, which have been merged into a new entity which has been given the brand name Air India. “The routes which are to be curtailed will be announced shortly. The airline hopes to save between Rs 500-600 crore during the current fiscal by introducing changes in the schedule,” the official added. Capacity cutThe airline plans to reduce capacity by about 10-12 per cent although the routes which were likely to be affected were not immediately made available. The airline has also reported losses in the past. During 2006-07, the State-owned carriers suffered a loss of around Rs 722 crore with Air India reporting a net loss of Rs 447.93 crore, while Indian is said to have suffered a loss of Rs 275 crore. More Stories on : Airlines
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