Air India Ltd., the state-run carrier that has survived on a 300 billion-rupee ($4.5 billion) taxpayer-funded bailout, is struggling to pay for spare parts, forcing it to ground two Boeing Co. Dreamliners.
The planes were not operational for about 10 months each as worldwide demand for parts outpaced supply from Boeing, and a “financial crunch" prevented Air India from procuring components on credit, Mahesh Sharma, India’s junior aviation minister, told parliament Thursday. The carrier kept paying rentals of $1 million every month for each of the two planes, in addition to losing money while they were out of operation, he said.
The grounded planes underline the woes of Air India, which has been unprofitable since its 2007 merger with state-owned domestic operator Indian Airlines Ltd. The carrier’s share in the local market has shrunk to 16 percent from 35 percent a decade back, placing it third in the national ranking, even as competition has intensified with foreign airlines buying stakes in local carriers and new ventures starting operations.
Dreamliner operators across the world are facing problems due to “high rate of failures of components,” Sharma said. He added that Boeing “could not support the demand of failed units on various 787 aircraft, since demand was more than supply.”
04/12/15 Anurag Kotoky/Bloomberg
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The planes were not operational for about 10 months each as worldwide demand for parts outpaced supply from Boeing, and a “financial crunch" prevented Air India from procuring components on credit, Mahesh Sharma, India’s junior aviation minister, told parliament Thursday. The carrier kept paying rentals of $1 million every month for each of the two planes, in addition to losing money while they were out of operation, he said.
The grounded planes underline the woes of Air India, which has been unprofitable since its 2007 merger with state-owned domestic operator Indian Airlines Ltd. The carrier’s share in the local market has shrunk to 16 percent from 35 percent a decade back, placing it third in the national ranking, even as competition has intensified with foreign airlines buying stakes in local carriers and new ventures starting operations.
Dreamliner operators across the world are facing problems due to “high rate of failures of components,” Sharma said. He added that Boeing “could not support the demand of failed units on various 787 aircraft, since demand was more than supply.”
04/12/15 Anurag Kotoky/Bloomberg
