Air India (AI) has finally deployed Boeing 787 Dreamliner aircraft on its domestic network from today, after grounding it for around four months on safety concerns. With the induction of Dreamliner aircraft in its fleet, the airline will save atleast 20 percent on fuel cost which is around Rs 500 crore each quarter.
The carrier which has never made profit since its merger with former Indian Airlines in 2007, has taken various cost rationalisation measures, including phasing out fuel guzzling older aircraft and introducing efficient planes like the Dreamliner.
AI seems bullish on attaining operational efficiencies after inducting 787’s in its fleet. The airline is aiming to cut loss by around Rs 2000 crore in current fiscal by reducing staff and interest cost and other initiative. The airline has also managed to cut in 2012-13 loss by 43 percent to Rs 5599 crore. Its revenues have also risen 10 percent to Rs 16130 crore.
Fuel cost is a cause of concern for all carriers including AI. Domestic airlines are paying atleast 70 percent more toward fuel purchase than global carriers due to high taxes. The government has allowed operators to import fuel to bring down cost, but again it would not be an attractive preposition due to logistics cost.
15/05/13 Moneycontrol.com
