Air India plans to shift one-third of workers to new subsidiaries

In a move to restructure its balance sheet, cash-strapped national flag carrier Air India will shift at least one-third of its work force—around 10,000-12,000 out of 31,000—to two new strategic units that will take care of ground handling and engineering.
Both are proposed to be hived off from the parent company as subsidiaries.
These two subsidiaries will start operations immediately after the government clears the proposal. The clearance is expected by the fiscal year end in March 2011, according to two Air India executives.
Air India has formed two subsidiaries—Air India Air Transport Services Ltd for ground handling and Air India Engineering Service Ltd for aircraft maintenance.
Ground handling includes general administration, baggage, freight and mail handling, and the engineering division takes care of maintenance, repair and overhaul (MRO) of aircraft bodies and engines.
“The engineering and ground-handling businesses will be launched as separate entities immediately after the government gives its green signal,” said a senior Air India executive, who did not want to be identified.
The proposal to transfer one-third of employees to the new subsidiaries may be opposed by workers.
A senior union leader, representing the All India Aircraft Engineers Association, said there was no consensus about transferring employees to new subsidiaries.
21/12/10 P.R. Sanjai/Live Mint

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Categories: Air India Dec 2010