New Delhi: All its problems are far from over but national carrier Air India is in better shape than it has been in a while. The airline that has been making heavy losses for several years is likely to post its lowest loss this year. Several international routes, which have traditionally failed to cover even variable cost, are now covering it.
How did this happen? Of course, lower oil prices of late have helped Air India, as they have all the other airlines. But in the case of Air India, a few other things have happened, too.
One, by rationalising the fleet, the airline has managed to get rid of some fuel guzzlers. Virtually all the B 777-200 LRs, a drain on the finances, have been phased out. The 747s operations, another oil guzzler, are now marginal. On both 777 LRs and 747, the airline actually made a loss on the incremental cost of operation. In other words, it was cheaper to keep these on the ground than to fly on most routes.
17/02/15 Anjuli Bhargava/Business Standard
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How did this happen? Of course, lower oil prices of late have helped Air India, as they have all the other airlines. But in the case of Air India, a few other things have happened, too.
One, by rationalising the fleet, the airline has managed to get rid of some fuel guzzlers. Virtually all the B 777-200 LRs, a drain on the finances, have been phased out. The 747s operations, another oil guzzler, are now marginal. On both 777 LRs and 747, the airline actually made a loss on the incremental cost of operation. In other words, it was cheaper to keep these on the ground than to fly on most routes.
17/02/15 Anjuli Bhargava/Business Standard
