Air India runs 21 offices in cities it doesn’t fly to
National carrier Air India, with accumulated losses of Rs 7200 crore, maintains 21 overseas offices in cities to which it does not fly, reports Tushar Srivastava.india Updated: Apr 03, 2010 01:34 IST
National carrier Air India, with accumulated losses of Rs 7200 crore, maintains 21 overseas offices in cities to which it does not fly.
HT has a list of these offices on whose upkeep Air India spent around Rs 29 crore in 2008-09, the same year it incurred a loss of Rs 5548 crore. Two of them are in the United States, two in Canada, seven in Europe, four in Africa, four in Asia and two in Australia.
“No international airline keeps offline offices any more,” said Kapil Kaul, aviation expert. “Air India should have shut these stations long back.”
“It doesn’t make sense to have an offline office if the expenditure incurred in running it is much more than the revenue generated from that station,” added M.S Balakrishan, former director finance, Indian Airlines.
The only purpose of these offices is to promote the airline and sell tickets, a job that, Kaul said, could easily be outsourced to general sales agents (GSAs). “A majority of international airlines, which don’t have direct operations to India, have GSA’s here, who manage everything from commercial activities to advertising and are paid a commission by the airlines,” he said.
Besides most ticketing nowadays is done by airlines online.
The government has now asked Air India to close down all these offices as part of the rescue operation to bail out the bleeding airline, which includes an equity infusion of Rs 800 crore.
NACIL CMD Arvind Jadhav could not be contacted despite repeated attempts.