Wednesday, January 29, 2020

Air India’s network seen as biggest strength in flight to selloff

New Delhi: Jet Airways’ shutting down last April, leaving Air India as the only Indian carrier operating medium and long-haul non-stops between India and distant continents, is possibly the jewel in the on-sale Maharaja’s crown. While the terms of the second divestment attempt have been considerably sweetened by relaxing eligibility norms for bidders, allowing them to take on a much lower debtcum-liability burden and the government exiting fully, AI’s biggest strength could be its network.
AI’s 27 young Boeing 787 Dreamliners (average age 5.2 years) and 16 B777s (average age 10 years) operate 36 weekly flights to six North American destinations like New York (JFK and Newark), San Francisco, Chicago, Washington and Toronto, 37 weekly to London and Birmingham, 38 weekly to eight European destinations like Paris and Vienna and 84 in southeast, far east and Australian destinations like Tokyo, Seoul, Melbourne and Sydney. On India-Australia and routes like Delhi-Vienna/Chicago and Washington, AI is the only airline with direct flights.
Among Indian carriers, AI and AI Express account for 50.6% market share of international travel to and from India. Taking both foreign and Indian carriers into account, AI-AI Express’s share is 18.4%. Indian carriers account for just over a third (36%) of all international travel to and from the country.
“Growing organically will mean Vistara and Indi-Go will take several years to reach the network of AI. Acquiring AI will mean a plug and-play for medium and long haul operations. Both Vistara (with SIA as one of the parents) and Indi-Go are solid professional airlines for whom AI may make good business sense,” said a person involved in AI divestment. Vistara and IndiGo have not commented on this issue.
29/01/20 Saurabh Sinha/Times of India

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