Mumbai: Air India may be roiled by losses, a cash crunch, and controversies over appointments, but the airline’s new senior management wants to capture the lost glory of the “Maharajah” (the airline’s mascot), according to a senior executive whose appointment, ironically, has also been controversial.
In his first media interview after being appointed Air India’s chief training officer, Stephen Sukumar said the airline is in talks with some of the world’s best hotel chains to train its employees in an attempt “to bring back some of the once legendary shine of Air India on-board service”.
And for ground staff, the airline has developed training programmes benchmarked to those of other Star Alliance members, he added.
By the middle of next year, Air India will join Star Alliance, a global grouping of airlines with 27 members including Lufthansa German Airlines and Continental Airlines Inc.
And the airline has renegotiated all its training contracts and lowered total training costs by 29%, when compared with the last fiscal year, according to Sukumar.
However, the airline’s annual report doesn’t have a break-up of the amount spent on training.
The appointment of Sukumar, the former chief training officer at German airline Deutsche Lufthansa AG, has been controversial and the government has appointed a two-member committee to review his appointment.
Air India had made two key appointments on 28 September—of Sukumar and Air India Express’ chief operating officer Pawan Arora—despite objections being raised at the time by some members of the board.
Under the guidance of its new board, Air India has prepared a turnaround plan to wipe out its accumulated losses and reduce its total debt of Rs 40,000 crore.
Sukumar indicated that the controversy is behind him. He said he was interviewed by Prashant Narain Sukul, joint secretary, ministry of civil aviation, and Air India’s independent director, F.H. Major, around a month ago.
“They found me suitable to be the chief training officer of Air India Ltd and they also wanted me to look after the Star Alliance project,” he added.
Sukumar is convinced the Star Alliance entry is critical to the airline’s fortunes.
“We need worldwide access to other markets to participate in the global growth. Star Alliance offers nearly 2,000 destinations, and this will be an unbeatable advantage for Air India to outperform its local competitors. But it will not be easy to match their expectations,” he added.
Sukumar said the airline’s immediate focus is to modernize Air India’s booking system, prior to joining Star Alliance, and having a single code for the airline instead of two different codes currently—AI and IC (the code for formerly Indian Airlines which merged with Air India).
A senior Air India executive who did not want to be identified, said the airline would have a single code by February 2011.
According to experts, joining an alliance could lead to a 5% increase in passenger revenue. Several independent consultants said Air India’s service level has deteriorated due to various reasons, including shortage of personnel, low morale and the cash crunch.
But many say it will be tough to reverse the situation as the airline’s ownership is still with the government.
“One of the main drivers that led to privatization of British Airways was customer service; this is the case with Air India. Government ownership seems to be a critical constraint when it comes to making dynamic changes in the airline to adapt to new service levels,” said Rishikesha T. Krishnan, professor of corporate strategy at the Indian Institute of Management-Bangalore, who follows the Indian aviation sector closely.
In contrast, Krishnan added, state-owned firms that do not have much of an interface with retail customers, such as Bharat Heavy Electricals Ltd and Oil and Natural Gas Corp. Ltd, perform well.
Air India’s chief operating officer Gustav Baldauf admitted that the changes cannot be brought in immediately. “There is no magic wand to make the changes overnight. Turning around is a slow process. You may not be seeing the change immediately. But you will start feeling them shortly.”
Referring to the wide-body planes Boeing 787 (also known as Dreamliners) that Air India will induct into its fleet next year, Sukumar said the airline has to train another 500 pilots for the 787s.
Airline asks govt for Rs 2,000 crore more
Mumbai: State-run carrier Air India has sought an additional Rs 2,000 crore from the government for fiscal 2012, aviation minister Praful Patel said on Monday. The minister also said fund infusion of Rs 1,200 crore is expected in the next few days.
“It is a committment of the government of India to ensure that the national carrier is in good health. Some parameters have already improved, but much more needs to be done,” Patel said.
Passenger traffic at Air India rose 13.3% to 9.05 million in April-November, while revenue rose 22.6% to Rs 7,250 crore in the period, it said in a press release.
Air India still has debt of about Rs 19,000 crore.