Air India hires three consultants

Mumbai: Beleaguered flag carrier Air India has appointed three foreign consultancies to help redraw its flight network and save fuel costs, in a bid to cut down on expenses and earn a much needed equity infusion from the government.
The airline, run by National Aviation Co. of India Ltd (Nacil), needs to meet a cost-cutting target of Rs1,991 crore by March to get Rs2,000 crore as the first tranche of the equity infusion. But it has managed to save only Rs1,000 crore in the last six months, two senior airline officials said on condition of anonymity.
Aviation experts said the operational restructuring can only help in the short term, and even that could be thwarted by industrial action. Air India, they added, needs more autonomy to take commercial steps that the government is unwilling to allow.
Nacil, which was formed by merging Air India and Indian Airlines, had hired Ireland-based consultancy Accenture Ltd to advise on the integration process.
It has now appointed US-based aviation consultant Simat Helliesen and Eichner Inc. (SH&E), Flugwerkzeuge Aviation Software GmbH of Austria and Texas-based technology company Sabre Holding Corp.
“Simat Helliesen has been hired to prepare a profitable and best optimal route plan,” one of the officials said.
Flugwerkzeuge Aviation will help Air India pilots locate the best flight path for optimum use of jet fuel.
The company will also generate customized modules for pilots, outlining all technical details of the airports and aircraft they fly. SH&E will focus on the hubs and plan alignment with other international flights for smooth transfer of passengers across flights.
Nacil is also in talks with McKinsey and Co., Booz and Co. Inc. and NM Rothschild and Sons Ltd. One of them is likely to be hired to help in Air India’s financial restructuring, one of the officials said.
14/02/10 P.R. Sanjai/Live Mint

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Categories: Foreign Feb 2010, NACIL Feb 2010