Friday, May 12, 2006

A-I Express, Alliance to be merged as low-cost entity

Mumbai: The panel formed to look into the merger of Air-India (A-I) and Indian-Airlines (IA) is exploring the possibility of floating a subsidiary for low-cost operations by merging Air-India Express, the low-fare arm of A-I with Alliance Air, the decade-old wholly-owned subsidiary of IA servicing tier II cities. This could mean that India would have its first-ever low-cost carrier (LCC) having both domestic and international operations.
Air-India chairman and managing director V Thulasidas told FE , "There is no point floating a separate LCC altogether. As a low-cost option, Alliance Air and A-I Express will join together to form a subsidiary airline."
However, the consultant, to be appointed shortly, will examine the viability of the project.
On the rationale of merging both subsidiaries, Mr Thulasidas said, "The basic idea is to have a primary carrier based on our existing model and also a low-cost airline which can fly both domestic and international routes, post-merger."
12/05/06 Sagar Malviya & Neelasri Barman/Financial Express
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