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Bail out for Private Airlines ?

Posted by on 01 August 2009

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Bail out for Private Airlines ?

The decision making time has come for the aviation industry to sit to-gether and work out a plan and ensure survival of their business. Air India being a govt. enterprise will be rescued by the sovereign budget and funds. Whereas Pvt. airlines don t have any other option but to evaluate their services. The only way currently in view of low load factor, is to operate services on alternate days.

CODE SHARING : Already Air India has code sharing arrangements with Jet Airlines. Jet airlines has code sharing with Kingfisher, when the big three have neatly tied up what is the necessity to panic. Just operate on alternative days and work on alternative days and shut down completely on Sunday. This would ensure cost cutting to the maximum, Salaries can be cut 30 to 40% in lieu of only 12 to 14 days working per month with guaranteed Sunday holidays.

Alternate flying would mean better maintainence, load factor, and reduced cost of operation. On non flying days tie with Air India would be ideal solution to the problem. This will help Air India to recover from losses. The strain on infrastructure would be reduced to a large extent.

There is a case for reduction on ATF fuel prices which are taxed almost 50% with 25% average ST and excise of 25%. It is possible to cut ATF prices by reducing taxes to 8% each, which would bring down the cost by almost 30%. Airline was earlier regarded a rich mans luxury now it is turning out to be aam admi s means of transport.

We hope all the head honcos of the airlines will sit across over a beer and hope for good times to return.

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about blogger Basically I am a marketing man, with 25 years work experience across FMCG, Durable and Construction Industry. I love travelling, photography, blogging and exchanging idea... Read more

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