AI strategic units set to be airborne

New Delhi: Air India plans to seek cabinet approval to operationalise its six strategic business units (SBUs). The PSU is looking to place the proposal before the cabinet when the latter considers infusing Rs 1,200 crore equity into the ailing carrier.
The strategic business units are for low-cost airline, cargo, maintenance, repair and overhaul, ground handling, and engineering and related businesses.
The Cabinet Committee on Economic Affairs may take up the SBU issue later this month with equity infusion, sources said. In February, the government had infused Rs 800 crore into the carrier.
The Centre is looking at equity infusion in a phased manner based on the performance of the ailing carrier.
In 2007, when erstwhile Air India and Indian Airlines were merged into the National Aviation Company of India Ltd (Nacil), it was decided that the six SBUs would act as separate profit centres.
Besides, Nacil is likely to seek government approval to renegotiate its wage agreements with the airline’s 14 unions.
Nacil has as many as 10 agreements with the unions, two of which were derecognised following a flash strike three days after the Mangalore plane crash in May.
According to the unions, the wage bill is 18 per cent of the total turnover against a global average of about 22 per cent for most international carriers. The unions said the management had assured them that their views would be considered before finalising the turnaround plan, but the two sides were yet to hold concrete discussions.
15/09/10 Telegraph

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Categories: NACIL Sep 2010