Air India flies into monsoon headwinds

Beleaguered national carrier Air India (AI) has run into more rough weather as its earnings are expected to come down in the lean monsoon season, which has already set in, coupled with bankers shying off from extending more funds to the airline which continues to default on its payments. The airline has even been unable to pay the salaries to its 31,000-odd employees.
Generally, airlines report revenue losses of 20-30 per cent during the monsoon season, which runs from June-end to September in India, during which time lesser number of travellers take to the air.
Air India's employees have not been paid performance linked incentives (PLI) since March this year. PLI accounts for over 40 per cent of their salaries. This move has resulted in unrest and distrust amongst the carrier's employees. The airline's employees were paid May salaries without PLI as late as this Wednesday.
The state-run airline's management pleads helplessness saying it is unable to pay the PLI to its employees as it is facing severe financial crisis with daily operational losses running to over Rs 20 crore. Non-payment of salaries and incentives on earlier occasions has seen the airline's employees striking work.
Fed up with the situation, Air India's pilots are exploring jobs in other airlines, including foreign airlines while some have already quit. According to the civil aviation minister Vayalar Ravi, 1,600 Air India pilots draw a total of about Rs 800 crore in salary in a year and another Rs 800 crore is paid to its remaining 28,000 employees.
At least 10 associations and unions of the beleaguered carrier have individually written to the minister and sought an immediate appointment with him to discuss issues such as non-payment of salaries and the airline's turnaround plan. However, the minister has not met the employees.
30/06/11 Sanjay Singh/Business Today

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Categories: Air India Jun 2011