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Business Desk

The Statesman

Publication Date : 14-03-2013

National carrier Air India (AI) yesterday joined its domestic peers by announcing competitive cut in its fares to lure summer vacation passengers with an option to booking their tickets 60 days in advance.

The focus is mainly seen on all-time busiest Mumbai-Delhi route. Air India is offering an inclusive 60-day advance purchase of ticket at  3,981 rupees (US$1,270) which, regular travellers say, is as “cheap” as First Class Rajdhani Express or Duranto.

The tickets, an official spokesman said,can be booked through travel agents, online agents, Air India website or its booking offices. The Advance Purchase Fare (Apex) Scheme introduced on Tuesday evening will target domestic travellers who have been turning away from the national carrier and boarding low cost carriers such as IndiGo, SpiceJet or lapping up special offers by Jet Airways.

Flyers, an agent says, have choice between Indian Railways and the national carrier as they expect Air India to earn significant revenue if not profit in the same ratio. The Apex scheme is being introduced, according to Air India, to “strengthen the national carrier's foothold in he leisure travel market”.

Air India yesterday confirmed that it has received a communication from Boeing conveying America's Federal Aviation Authority's nod to the proposed solution to augment and improve security of the battery system in Dreamliner 787.

The proposal accepted by FAA, the watchdog-regulator, pertains to containment of batteries in a box and separation of these batteries from each other. The boxes will have vents to curb over-heating. A Boeing team is likely to visit India which has so far received six Dreamliners since December 2012. If the new system is tested and safety confirmed, Air India proposes to resume flying its  787 Dreamliner aircraft.

Aviation industry analysts say Air India's earnings before interest, tax, depreciation and amoratization for 2013-14, on the basis of current calculations, can be around 1,050 crore rupees in view of its improved commercial performance. The national carrier is expected to ferry more than 1.6 crore passengers in the year which will be a growth of about 15 per cent over 2012-13. (One crore is equivalent to 10 million.)

For AI, it will be a significant turnaround after the more than five years.

Last April, the government had cleared a 30,000-crore rupee bail-out package which included upfront equity infusion of Rs 6,750 crore and equity back-up allocation of 23,480 crore rupees until 2020-21. As on  July 31, 2012, Air India's total debts were at 47,226 crore rupees. To make the operation more cost effective, the airline plans to sell its Boeing 777-200 LR and also has a leaseback proposal for new 787 planes which are more economical.

*US$1=3.1 rupees