Air India to hive off low-cost arm into separate entity

New Delhi: Air India Express, the low-cost arm of state-owned Air India, will be hived off into a separate company as the airline looks at ways to manage its costs better.
The airline will appoint a CEO to come on board within the next fortnight for the no-frills venture.
As part of the restructuring, Air India Express — that currently flies to destinations in the Gulf and south-east Asia — will tap the domestic market and provide connectivity within the country by March 2011.
The National Aviation Company of India, or Nacil, that runs Air India, will also set up two MRO (maintenance, repair and overhaul) facilities in Thiruvananthapuram, Kerala for the low-cost venture.
“Twenty five aircraft will be based out of Kerala and two MROs will be sufficient to maintain them. The only problem is finding skilled manpower and we will have to recruit around 500 more people down south for this,” said Air India Chairman and Managing Director, Arvind Jadhav.
However, they did not disclose the expenditure to be incurred for setting up the facilities.
16/09/10 Economic Times

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Categories: Air India Budget Sep 2010, NACIL Sep 2010, New Sep 2010