Huge losses cause Air India to restructure routes

Air India is set to restructure its routes as losses soar, with accumulated losses of Rs 4,334 crore since 2007 ending 31 March 2009.
Of those accumulated losses, 2008/09 accounts for Rs 3000 crore which the state airline says were due to large debts it was not able to pay oil companies and airport authorities.
Mumbai’s Business Standard reported that a primary reason for the crippling loss was due to the 26 percent fall in cargo traffic earlier this year. However, sources from the airline claim cargo operations account for only 5 percent of revenues.
In an effort to curb losses in National Aviation Company of India Ltd (Nacil), the state-owned company which runs the carrier, the Indian government has suggested heavy cutbacks in routes and a restructure of aircraft deployment and flight timings.
Routes to be restructured will include London and South East Asia which have experienced low passenger loads.
04/05/09 eTravel Blackboard

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Categories: NACIL May 2009