Melbourne flight divides AI, ministry

New Delhi: Despite the civil aviation ministry conveying its displeasure, the National Aviation Company of India Ltd (NACIL), which runs Air India, has presented a strong case for starting a non-stop flight on the Delhi-Melbourne sector . NACIL has said the route would generate surplus cash of about Rs 59 crore over 18 months of its operation.
The airline management recently informed the company board, comprising Mahindra and Mahindra vice-chairman and MD, Anand Mahindra and Ambuja Realty chairman Harsh Neotia that the deployment of the aircraft on an alternative Mumbai-JFK (New York) would result into higher losses. Contesting the ministry’s stand, NACIL CMD Arvind Jadhav has said that commencing the Delhi-Melbourne operation would give the airline first mover advantage.
In a letter to the airline, the civil aviation ministry had asked it to reconsider its decision to operate the long-haul Delhi-Melbourne flight.
“In the first year of operation the airline would lose Rs 10 crore but would become profitable in the long run,” said an airline official.
The airline’s long-haul international flights contribute to majority of the majority of its losses, with its services to New York from Delhi and Mumbai alone adding Rs 400 crore annually to the losses.
06/09/10 Nirbhay Kumar/Fiancial Express

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Categories: Air India - International Sep 2010, Foreign Sep 2010, NACIL Sep 2010