1. T N Ninan: Nehru's grandchildren
Vayalar Ravi, the new minister for civil aviation, declared on assuming office that his priority would be “to improve the services on Air India and to make it a profitable airline”. He allayed the fears of Air India employees’ unions about a wage freeze and re-deployment to the airline’s subsidiaries. For good measure, he added that he would look into the de-registration of two of the airline’s 14 unions.
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Mr Ravi’s predecessor, Praful Patel, had declared that he was the minister for civil aviation, not the minister for Air India. His critics would charge that he was actually the minister against Air India, given how the airline was destroyed on his watch. Indeed, Capt Gopinath of the erstwhile Deccan Aviation once charged that Mr Patel was the minister for Jet Airways — drawing a sharp riposte from the minister. Irrespective of whom you believe, there were sounds of relief from Air India when Mr Patel was moved out. The problem, though, is that the country once again seems to have a minister for Air India, more than a minister for civil aviation.
It so happens that Air India is now only the fourth-largest airline in the country. It is in danger of becoming the fifth largest, because SpiceJet too may overtake it. So the “national carrier” is no longer a critical factor in the market. In any case, reviving it is the job of the airline management. Trade union recognition, wage bills and staff deployment are all within the management’s purview — with due clearance from the airline’s board, which includes government nominees.
Besides, how exactly would a minister improve Air India’s services? Everyone knows that Air India cannot be salvaged if it does not cut costs and attract more passengers. But if the minister signals that he is on the side of the unions on key staff issues, he reduces the management’s scope of action as well as the likelihood of better service. The prospects for the airline are already dim; Mr Ravi, with all the goodwill that he has for Air India, has just made its future bleaker.
The bald fact is that, given its one-sixth share of the aviation market, Air India’s demise would not make much difference to anyone who is not its employee. Privatisation would be a softer option than closure, but many people like Mr Ravi, including the majority of politicians, would consider even that unthinkable. In any case, the employees would go on strike, and that might make potential buyers stay away. If someone did come forward, it would only be because the airline was going cheap. But a cheap sell would make privatisation even less palatable (“Family jewels being sold for a song!”). So the government (i.e. the taxpayer) will have to pick up the bill. The question is, why should we? So that Mr Ravi can be nice to the unions?
The truth is that the majority of elderly Indian politicians (among them the 73-year-old Mr Ravi) cut their milk-teeth in the heyday of Jawaharlal Nehru, who dreamt of the public sector occupying the commanding heights of the economy. Many of the rest were schooled in Indira Gandhi’s populism. The first has been dead for nearly a half-century, the second for a quarter-century. But their approaches to public policy have proved resilient to an unusual degree, even as the reality has changed (public sector Plan investment, for instance, has shrunk from over a half of the total to less than a fifth). But while the private sector now occupies the heights, the pity is that our pro-market politicians are all too often in bed with crony capitalists.
2.Flyers can now get refund on all tickets
CHENNAI: Passengers used to lose money if they booked a non-refundable ticket online and then did not fly. Not anymore. Passengers can now cancel their non-refundable ticket till two hours before departure and get a refund of taxes, fuel surcharge, passenger service fee and user development fee.
This means a passenger stands to get back Rs 1,300 to Rs 3,800, depending on the distance and the ticket price. Fuel surcharge varies from Rs 1,000 for a short-haul domestic flight to Rs 3,500 for a long-haul flight. Low-cost carriers like Indigo, SpiceJet, Jet Konnect and Go Air charge Rs 229 passenger service fee and Rs 103 service tax.
Airlines decided to make the refund after discussions at the Civil Aviation Economic Advisory Council last month. Air Passengers Association of India has been demanding this. "This is a big relief for passengers, especially for those buying round trip tickets" said passengers association president D Sudhakara Reddy. "Those taking round trip tickets were losing money even if they missed only one leg of the journey."
Travel agents said that full service airlines have reduced the cancellation fee. "Air India now charges Rs 150 for cancellation of a domestic ticket. Jet Airways charges a flat rate of Rs 750 for the lowest fare," said Prema Radhakrishan of Emerald Airways.
Reddy said a working group on regulatory framework and the Civil Aviation Economic Advisory Council were able to address the long-pending issues such as lack of transparency in fares printed on ticket, high spot fares and appointment of ombudsman.
The working group also discussed the need to address high aviation turbine fuel taxes, airport charges, aeronautical navigational service charges and other costs that would increase fare levels.
3. Top Aviation news of the week
IndiGo Airline has become the India's No. 2 airline equaling Kingfisher Airlines in December, and Air India-domestic to take the No. 3 spot, according to a report.
Top Stories
IndiGo rises to joint No. 2 with Kingfisher
IndiGo Airline has become the India's No. 2 airline equaling Kingfisher Airlines in December, and Air India-domestic to take the No. 3 spot, according to a report. The report stated that Kingfisher and IndiGo had a market share of 18.6%, the Jet-JetLite combine was ahead with 25.4%. Indigo flew 9.71 lakh passengers in December 2010 compared with Kingfisher’s 9.72 lakh, adds report.
Air India mandates ICICI to refinance loans for buying A-320 aircraft: report
National Carrier Air India Board has given a mandate to ICICI Bank to refinance Rs55bn loans to purchase 21 A-320 aircraft, according to a report.The report stated that board has approved delivery financing of three B-777-300ER aircraft and one GE-90 spare engines with US Exim support worth US$475-million
The board also gave its nod to Air India to dispose off four A 310 passenger aircraft along with the simulator, adds report.There are reports that the most important decision of Pawan Arora as CEO of Air India Express in the company, did not come up for discussion.
In Focus Stories
Indian airlines break 5mn barrier in December
Indian airlines carried more than 50 lakh domestic passengers in December, setting a new landmark in the aviation industry, the latest data released by the Directorate General of Civil Aviation (DGCA) showed.Airlines carried 52.13 lakh passengers in December, up from 44.87 lakh passengers carried in the same period of the previous year, reporting a growth of almost 16%.
The total domestic passengers carried by the Scheduled Airlines of India in November was 48.75 lakhs as against 46.17 lakhs in October 2010. During January-December 2010, domestic airlines carried 520.21 lakh passengers compared to 438.40 lakhs in 2009.
The total domestic passengers carried by the Scheduled Airlines in the fourth quarter of 2010 (October to December) were 147.05 lakhs.The total domestic passengers carried by the Scheduled Airlines in the third quarter of 2010 (July to September) were 119.84 lakhs.
The total domestic passengers carried by the Scheduled Airlines in the second quarter of 2010 (April to June 2010) were 134.78 lakhs.The total domestic passengers carried by the Scheduled Airlines in the first quarter of 2010 (January to March 2010) were 118.54 lakhs.
Low-cost carrier IndiGo became the third largest domestic passenger airline in the country for the fourth quarter of 2010.IndiGo carried 25.89 lakh passengers, followed by Air India's domestic arm at 25.42 lakh passengers. They were followed by Spice Jet (20.01 lakh), Jet Lite (10.85 lakh) and Go Air (9.79 lakh).
Kingfisher Airlines carried 27.81 lakh passengers, closely followed by Jet Airways with 27.28 lakh passengers
Domestic News
Air India plans to lease 40 Airbus, Bombardier Planes: report
Air India Ltd has sought bids to lease as many as 40 Airbus SAS and Bombardier Inc. aircraft, according to a report.
The report stated that the airline wants to lease 10 Airbus A320s, 10 A330s and as many as 20 CRJ-700 planes.
Air India has a fleet of 135 planes and is expecting 30 more aircraft deliveries in the next few years, adds report.
Indian airlines break 5mn barrier in December
Kingfisher flight makes emergency landing in Bangalore: report
IndiGo to operate international flights from August: report
Jet Airways registers 8.5% growth in domestic operations in December 2010
Security scare for Kingfisher Mumbai-Bhubaneshwar flight
Pratt & Whitney, Air India showcases cutting edge Eco Power Engine Wash Technology
International News
Meggitt buys Danaher unit for US$685mn
Meggitt Plc has agreed to buy Pacific Scientific Aerospace from Danaher Corp. for US$685mn to expand its range of fire-fighting products. According to reports, the purchase of PSA, which also makes generators, electric motors and other safety gear for aircraft, will be funded by selling as many as 69.8 mn shares, equal to about 9.09% of the company, to new and current institutional investors.
Adding the Danaher unit will allow Meggitt to bundle together more products for aircraft including Boeing’s 787 Dreamliner and the Airbus A380 superjumbo as production accelerates. Meggitt paid 8.7 times earnings before interest, tax, depreciation and amortization and it estimated savings of about $5 million in 2011, rising to about $18 million by 2014, said a financial daily.
Boeing 787s resume test Flights for Certification: report
Boeing Co has reportedly said that its delayed 787 aircraft had resumed the test flights required by government regulators before it can make its first customer delivery. The report stated that Boeing restarted 787 test flights a month ago after finding a "fix" for the problem that led to an onboard fire during a flight on Nov. 9. Another two planes would restart certification flights in a week or so, adds report.
Embraer closes out 2010 with 246 jets delivered
Fly thru with AirAsia
British Airways lists Top Five Indian destinations for 2011
Air New Zealand plans to acquire up to 14.99% of Virgin Blue .
4. InterGlobe General Aviation announces delivery to India of 2000th King Air C90
Entering into the market more than 45 years ago, the C90 has long been considered as the entry-level business and personal aircraft of choice.
InterGlobe General Aviation Pvt. Limited, a subsidiary of InterGlobe Enterprises and the exclusive representative for Hawker Beechcraft Corporation, the world’s leading manufacturer of business and special mission aircraft, has announced the delivery of the 2000th King Air C90 to an Indian customer based in Delhi.
Entering into the market more than 45 years ago, the C90 has long been considered as the entry-level business and personal aircraft of choice. The King Air C90 Series aircraft is defined by all aircraft with LJ serial numbers, including the 90, A90, B90 and all C90 models. The milestone aircraft, a King Air C90GTx, represents the latest advancement in this most successful turbine aircraft lineup in general aviation today.
The C90GTx offers higher fuel efficiency, greater performance and efficiency and provides absolute consumer delight. The upgraded aircraft includes an in-flight accessible, heated and pressurized baggage storage area along with a private lavatory as standard. It also boasts a cabin 50 percent larger than some very light jets, which seats up to six passengers in its famed squared-oval design, allowing greater passenger comfort.
Mr. Nigel Harwood, President and CEO, InterGlobe General Aviation said, “We are delighted to deliver the 2000th aircraft here to India and the very first advanced C90GTx in the country. This series of aircraft has been an immensely popular choice in India for many years and we are confident of its future success.”
He further added, “The aircraft opportunity in India is very large. The booming markets and evolving lifestyle aspirations has resulted in a surge in demand for aircraft in the last few years. InterGlobe General Aviation is committed to providing solutions to its customers, addressing their lifestyle and business needs seamlessly.”
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