Consolidation brings savings for airlines

New Delhi: Consolidation in the Indian skies has started yielding results for airlines. While cheapest airfares have shown a marginal increase re-cently — helping airlines come out of the red — a “correction” in salaries and perks of technical personnel, including pilots, in the past six months is likely to translate into lower operating cost for the carriers.
M&As in the aviation space have brought economies of scale for airlines.
The correction has happened after the three mega-mergers in the domestic skies and the disparity in salaries among various airlines has also started narrowing.
“Airlines are pretty much aligned now as far as salaries are concerned. The sporadic increases in salaries that happened in the past two years have come down now,” says Surajit Banerjee, vice-president-HR, SpiceJet. Agrees a senior Air India official: “There are increased synergies between airlines now.
There are only minor differences in salaries of pilots working for different airlines. Also, stricter regulations such as a six-month notice to be given before a pilot leaves, have given increased bargaining power to airlines,” he said.
Some low-cost airlines are, however, yet to realise the benefits.
05/10/07 Nirbhay Kumar & Vishakha Talreja/Economic Times

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Categories: General Aviation Oct 2007