New Delhi: With crisis-ridden Air India on the verge of a partial shutdown due to simmering differences between pilots of the erstwhile AI and Indian Airlines, the government has finally admitted that merging these two airlines five years back has not worked out well for the company.
Stopping short of terming it a mistake, civil aviation minister Ajit Singh told TOI: "The merger has not worked out as planned. Maybe some benefits were foreseen out of this move like synergy and economies of scale, but those did not happen."
Both AI and IA were making cash profits till fiscal 2006-07 but have seen losses soaring thereafter.
Asked if it made more sense to run AI and IA separately under one umbrella organization, the minister said 70% of the merger process in areas like IT, accounting, flight codes and marketing were complete.
14/05/12 Economic Times
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