New Delhi: India’s new aviation minister wants to assess just how “beneficial” the expensive hires Air India has made in recent months have been.
Vayalar Ravi said he had asked the loss-making airline to give him, in the next fortnight, a report on the contribution of the controversial recruitments. His request came on Saturday, after a day-long review of the airline and its subsidiary Air India Express.
Last year, as it set about implementing a turnaround plan, Air India, which lost around Rs 5,551 crore in 2009-10 alone, hired four top executives, Austrian Gustav Baldauf as chief operating officer (COO), Stefan Sukumar as chief of training, Pawan Arora as COO of Air India Express and Kamaljit Rattan as the public relations chief. The hires cost around Rs 6-7 crore a year and came despite objections raised by some members of the airline’s board as reported by Mint on 29 September. In November, the board asked the airline to sack Arora, who still continues to serve as COO of Air India Express.
The Saturday review was attended by aviation secretary Nasim Zaidi, Air India’s chairman and managing director Arvind Jadhav, Baldauf and senior officials at the airline and the ministry.
Ravi asked the airline to “give me a report on their activities, what are they doing... just to make my own evaluation. I discussed their role (but have) not given any direction,” Ravi said. “I have asked them to get all the details so I can come to my own conclusion. I am neither in favour or against them. I have an open mind. But I must know how beneficial they are to the institution.”
He denied ordering the removal of the executives.
A retired Air India official said there has been “zero performance” by the new hires and said the disconnect between them and Air India’s employees was growing, leaving little scope for an effective turnaround. The airline has received Rs.2,000 crore equity from the government this fiscal and wants another Rs.2,000 crore next year as part of a bailout package.
“During his (Baldauf’s) time, Air India has slipped to No. 4 (in market share), which means you have taken no effective measure to increase revenue and productivity,” said Jitender Bhargava, who retired as executive director of the airline last year. “Their acceptability is zero in the organization. When Baldauf and Arora come to the airline’s Delhi office, they are not even welcomed by Air India employees and sit aloof. What turnaround will they do?”
Among the recent instances of mismanagement was the poorly executed move to Delhi’s new Terminal 3 in November.
Bhargava has emerged as a trenchant critic of the airline’s performance and its management since his retirement.
Baldauf defended his tenure at Air India and said much had been accomplished since he took charge.
“After I came, within seven months we set up a new business plan for the airline, with each and every route well defined. We set up the Indian hopper plan” for a regional airline, he said. “We moved to T3 (Terminal 3). We are integrating the passenger reservation system this month. I would like to see Air India as part of Star Alliance this year. But not everything can be done in six months.”
He said the turnaround plan is awaiting government approval.
“The board has approved it, but we cannot wait any longer. Without that, the company will not survive,” he said.
With regard to opposition to him, Baldauf said, “Whenever you will be in such a position, you will have enemies. You cannot please everybody.”
Arora declined to comment for the story. An email sent to the Air India spokesman remained unanswered.
Meanwhile, the civil aviation ministry and the airline continue to fight a cold war over Arora’s appointment.
The airline is yet to respond to a letter from the ministry, as Mint reported on 29 November, asking why Arora was still COO of Air India Express. A ministry official, who did not want to be named, said the airline had informally told the ministry that it is seeking legal advice on dismissing Arora. This person added that the ministry has asked the airline that pending this, it should ensure that Arora doesn’t attend office and take key decisions.
On Saturday, Arora wasn’t allowed to make a presentation to Ravi, according to a person familiar with the matter, and the minister had to instead be briefed by Jadhav.
Ravi has also asked for a retired judge to look into the issue of wage parity in the airline that’s pending since the merger of Indian Airlines and Air India in 2007. The merger has not been accompanied by the integration of their workforce. Air India unions will meet the minister next week in Mumbai to discuss this and other issues.