National carrier Air India has unveiled its second set of cost-cutting measures to survive the COVID-19 outbreak and also ensure that it remains attractive when it is sold.
Highlights of the 21 steps proposed include a special drive to recover dues from government departments by March 31, negotiations with aircraft lessors and hotels overseas, a 10% cut in salaries, increasing cargo loads to make up for passenger loss and temporarily invoking force majeure in all agreements.
An official order issued on Saturday said that in the wake of recent global developments and the serious impact of COVID-19, which has adversely impacted the aviation industry both in domestic as well international sectors, there is an insurmountable dip in the revenue, which calls for stringent measures to reduce costs. All airlines have taken drastic steps to survive the current crisis and an urgent need is felt to take steps to curtail costs to mitigate the current financial crisis.
The order said that at an emergency meeting of the executive management committee meeting held on March 18 it was decided that an exercise to review all agreements and renegotiate with lessors be undertaken.
In view of the suspension/reduction of various flights, especially international flights, the management asked the hotel committee to undertake a review of the existing agreements for reducing the rates to the extent possible.
21/03/20 Aditya Anand/The Hindu
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Highlights of the 21 steps proposed include a special drive to recover dues from government departments by March 31, negotiations with aircraft lessors and hotels overseas, a 10% cut in salaries, increasing cargo loads to make up for passenger loss and temporarily invoking force majeure in all agreements.
An official order issued on Saturday said that in the wake of recent global developments and the serious impact of COVID-19, which has adversely impacted the aviation industry both in domestic as well international sectors, there is an insurmountable dip in the revenue, which calls for stringent measures to reduce costs. All airlines have taken drastic steps to survive the current crisis and an urgent need is felt to take steps to curtail costs to mitigate the current financial crisis.
The order said that at an emergency meeting of the executive management committee meeting held on March 18 it was decided that an exercise to review all agreements and renegotiate with lessors be undertaken.
In view of the suspension/reduction of various flights, especially international flights, the management asked the hotel committee to undertake a review of the existing agreements for reducing the rates to the extent possible.
21/03/20 Aditya Anand/The Hindu
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