Air India fights for survival, chief says time to face truth
A day after Air India asked its top executives to forego their salary for July, Air India Chief Arvind Jadhav today said the delay in paying the staff salary has become necessary as the airline is fighting for survival. Yet, Air India, unlike many other airlines, has not retrenched or laid-off of staff till date.india Updated: Jun 21, 2009 00:16 IST
Crisis-hit Air India Chief Arvind Jadhav on Saturday said the delay in paying the staff salary has become necessary as the airline is fighting for survival.
"This is an hour of crisis. This is a fight for survival. The survival of our own airline. Jadhav said in a message to National Aviation Corporation India Limited (NACIL) employees.
The aviation industry is going through turbulent times. Yet, Air India, unlike many other airlines, has not retrenched or laid-off of staff till date, he said.
"Air India has only decided to defer salary and PLI for June only by 15 days and requested senior officials to voluntarily forego July salary."
Jadhav said loans from financial institutions at high interest rates couldn't be availed endlessly to meet working capital requirement. "Time has come to face the moment of truth in Air India as well."
Air India has approached the Government for infusion of funds. But, as we have seen in the US, the help comes with conditions attached, Jadhav said.
To tide over the difficult situation, airlines globally have taken harsh and unpleasant decisions, Jadhav said, adding, "We should consider our self fortunate that we have been insulated from the adverse impact of the economic slowdown so far." He cautioned employees about the consequences of disinvestments. "We need to be conscious of the impact that disinvestments / privatisation can have on our own lives, should this materialise."
Reeling under the impact of downturn in global economies and record-breaking aviation turbine fuel prices, airlines the world over have resorted to cutting operating costs and minimising losses.
According to the International Air Transport Association (IATA), the global aviation industry is expected to lose about nine billion dollars this year.
The domestic aviation industry, says Centre for Asia Pacific Aviation (CAPA), is likely to incur around 2-billion losses this year.
Two major domestic air-carriers, Kingfisher Airlines and Jet Airways have reduced jobs, slashed salaries, besides pruning capacity.
Global airlines such as Singapore Airlines, British Airways, Cathay Pacific, Japan Airlines, American Airlines, Delta, Air France-KLM and Qantas have taken similar measures to lessen the impact of current crisis.
Pilots of the Singapore Airlines have agreed to one-day compulsory leave every month. Managers and administrative officers are taking one day a month either as unpaid leave or from their annual leave.
British Airways has frozen pay and cut around 2,500 jobs since last year. It has also sought 4000 voluntary redundancies.
American Airlines has announced plans would cut upto 1,600 positions by August this year. Japan Airlines wants to cut 1,200 jobs by March 2010.