AI aims to win back market leadership: CMD

New Delhi: With Jet and Kingfisher striking an alliance, the fight among full service carriers of India had become rather dull as the national carrier was just seeing its domestic market share drop relentlessly ever since the merger of Indian Airlines and Air India in late 2007. But the mild-mannered CMD of the merged entity, Raghu Menon, suddenly announced the airline's intention of striking a comeback by substantially reducing airfares by 10% to 45% on Tuesday.
Now with a combination of genuinely low airfares and brand new aircraft, Menon has made a New Year resolution to lure back passengers lost to other carriers and make AI (domestic) the market leader again in coming months. In fact, he did not even rule out possibility of further fare cuts, if oil continued its downward journey in 2009.
Asked how an airline that lost about Rs 2,300 crore last fiscal and may end up with double that figure this time could strike a balance between its revenue requirement and the announced fare cuts, Menon told TOI on Wednesday: "We were guided more by fact that fuel prices have come down sharply. Although AI had taken the lead in November by reducing fuel surcharge by Rs 400, that was not enough. We wanted to offer a substantial concession despite the fact that airlines are still facing financial difficulties. It has become important to revive travel, both leisure and corporate."
In fact he added that if oil prices do not defy gravity again, AI could break even or "even be positive" in 2009-10.
01/01/09 Saurabh Sinha/Times of India

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Categories: NACIL Jan 2009