Tuesday, August 15, 2006

Ai-Indian Merger Plans Ready to Take-Off

The merger of Indian (former Indian Airlines) and Air India now seems just around the corner. The Civil Aviation ministry led by Praful Patel is moving at top speed to merge the two entities before the end of 2006.
A consultant has been appointed by the Aviation Ministry together with Air India to show the path forward in this direction.
With both carriers losing their market share at an alarming pace, merging the two comes forward as an only alternative. While Air India’s market share fell from 35% in 1980 to 18-20% in early 2000, Indian saw steep fall from 40% market share in 2003-04 to 20-24% as of today.
Moreover, for survival in this competitive scenario, size remains the key.
The merged entity would have staff strength of 34,200 employees and fleet size of over 125 planes. Collectively making a capital base of Rs. 260 crore the new entity would have a turnover of Rs. 14,900 crore.
14/08/06 Jyoti Pal/The Money Times
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