Indian Airlines merger behind Air India's fin woes: Experts

Critics are blaming a mis-managed merger with Indian Airlines as the major reason for Air India's financial doldrums. ITC Chairman YC Deveshwar, who headed Air India in the 90s, told CNBC-TV18’s Tanvi Shuka and Vidhi Godiawala in an exclusive interview that he would have handled things differently.
Air India was not always flying through turbulent times. In 1993, under the leadership of ITC chairman YC Deveshwar, it was a profitable company -- among the top five globally.
Today, critics say the merger with Indian Airlines was mis-managed and ill-planned, and led to the airline's financial troubles. Deveshwar says he would have taken a different approach.
YC Deveshwar, Chairman, ITC, said, "I would have done it differently. I would have first created two divisions and then identified those areas where there are synergies. Definitely, I would have gone into getting the same genre of planes, so that the pilot training could be common. This strategy has to unfold, conceptualized much before you begin to buy planes as two different organizations."
Experts say the merger remained on paper, but was not implemented properly. Buying of planes, route planning as well as recruitment of pilots was not done on a consolidated basis.
30/07/09 CNBC-TV18/Moneycontrol.com

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Categories: NACIL Jul 2009