New planes boost Air India passenger load, revenues

MUMBAI - Flag carrier Air India increased its passenger load by over 10 percent in 2009 and reduced costs by deploying new aircraft and rationalising routes, the airline said Saturday.

Addressing reporters here, Air India chairman and managing director Arvind Jadhav said the induction of 29 aircraft and enhanced utilisation of the fleet helped the carrier phase out 11 old aircraft.

“By March 2010 three more Boeing B-777-200s, two Airbus A-310s and eight Airbus A-320s shall be returned or retired from the fleet as part of this exercise,” Jadhav added.

Better utilisation of the fleet also helped in releasing capacity of five Boeing 747-400s and two Airbus A-330s for Haj pilgrimage, which resulted in substantial savings.

These and other measures would help the carrier save Rs.378 crore through cost reductions during its winter schedule and Rs.563 crore for the entire year, Jadhav said.

Besides route rationalisation, Air India withdrew from sectors like the India-Gulf routes and transferred these to Air India Express, its low-cost carrier, to improve profitability.

During April-November, Air India carried 10.1 percent more passengers than in the corresponding period last year, Jadhav said. Its share in the domestic market rose from 16.6 percent in August to 18.5 percent in November.

In November, its market share and load factor of 74.1 percent were higher than that of other carriers on stand-alone basis. “We expect to maintain the uptrend in performance in the coming months too.”

According to Jadhav, Air India added seven Boeing 777s, eight Airbus A-321s and nine Airbus A-319s, besides five Boeing 737-800s for Air India Express, during 2009.

The Boeing 777s were deployed for the winter schedule from October on all its seven West-bound destinations in the US, Europe, Canada and Japan, which resulted in reduction in cost of operations as these aircraft are more fuel-efficient.

On the domestic sector, Air India deployed more Airbus A-319 and A-321 to replace the A-320s.

The inductions enabled the carrier expand its network by introducing domestic pairs on sectors such as Bangalore-Hyderabad, Chennai Bhubaneshwar, Hyderabad-Pune, Hyderabad-Kochi, Hyderabad-Colombo, Chennai-Cochin and Bangalore-Kochi.

On international sectors, the new aircraft enabled it to extend the New Delhi-New York service up to Washington.

The carrier also relaunched its “frequent flyer programme” by amending the mileage table to make it more competitive with better redemption levels, with the participation of Lufthansa and Singapore Airlines.

Jadhav said a series of cost-cutting initiatives through monitoring of fuel efficiency parametres enabled a saving of Rs.146 crore till October.

This included curtailing expenditure on hotel accommodation, transportation, foreign and domestic travel and as overtime, apart from combining the booking offices of Air India-India Airlines to save on establishment costs, he said.

Additionally, according to Jadav, the carrier saved Rs.5 crore by giving up its office at Jeevan Bharti building in New Delhi.