‘Let Air India be low-cost carrier on some routes’: Aviation ministry | business | Hindustan Times
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‘Let Air India be low-cost carrier on some routes’: Aviation ministry

business Updated: Oct 15, 2015 00:04 IST
Tushar Srivastava
Tushar Srivastava
Hindustan Times
Air India

AI, a full-service carrier, offers food free of cost to passengers and has a two-class configuration of business and economy class seats on most of its planes that operate on domestic routes unlike low cost carriers.(Sattish Bate/HT File Photo)

Air India (AI) should be run as a low-cost carrier on some domestic routes, a worried aviation ministry has suggested to the top brass of the debt-laden airline. The suggestion came from aviation secretary RN Choubey during a recent meeting of the Oversight Committee (OC) that monitors AI’s turnaround plan.

AI, a full-service carrier, offers food free of cost to passengers and has a two-class configuration of business and economy class seats on most of its planes that operate on domestic routes unlike low cost carriers.

“(Aviation) Secretary enquired as to why AI cannot be a low-cost carrier,” said the minutes of the July 3 meeting accessed by HT. “Secretary said that on certain sectors AI could be full service carrier while on others it could function as an LCC.”

A couple of years back AI had stopped serving free food to domestic economy passengers on some short-haul routes, a move the airline had estimated would result in annual savings of `100 crore. AI officials informed the OC that “due to criticism” it had to again start serving free food.

While Choubey did not respond, an AI official said the airline was already operating a hybrid system and some of its planes were all-economy.

The loss-making carrier is surviving on a taxpayer-funded bailout. The government has already pumped in around Rs 18,000 crore of the Rs 30,231 crore it plans to infuse by 2021. With little signs of a turnaround the Prime Minister’s Office was forced to pick Ashwani Lohani, a “turnaround specialist” to head the airline.