Government rethinks on Air India's 787 Dreamliner purchase

New Delhi: The aviation ministry is rethinking whether cash-strapped Air India can go ahead with the order for 27 Boeing 787 Dreamliners as part of the mega order of 111 new planes worth Rs 55,000 crore placed during UPA-1 .
These aircraft have been delayed by over two years and the Boeing says the delivery could begin in a few months. But given the financial position of AI, the ministry is no longer sure whether the airline - that's not getting loans to pay even salaries - can afford this acquisition.
AI is looking at a loss of Rs 7,000 crore in 2010-11 that will take the accumulated losses to around Rs 21,000 crore.
"Coupled with working capital and aircraft acquisition loans and vendor dues of Rs 4,500 crore, the total liability is close to Rs 60,000 crore. The monthly loss is Rs 400-450 crore. The daily income is such that it just about covers the fuel bill. In such a situation whether we can go ahead with the 27 Dreamliners that will push the liability to Rs 90,000 crore is a serious question staring us," said sources.
Aware of the almost unbridgeable gap between a section of employees and AI CMD Arvind Jadhav, sources said a hunt for a new CMD has begun.
06/06/11 Saurabh/Times of India

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Categories: Airports Jun 2011