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Air India, winner of the year 2013

After staying in doldrums for many years, India’s national carrier Air India is back in business. 2013 will remain in the airline’s history as the year of rebirth.

DELHI- Air India has long been considered as the sick man of India air transport. Especially after 2007, when the airline had to find ways to merge with its domestic counterpart Indian Airlines.  Negotiations between both airlines lasted for ever. The merger occurred but was so ill-conceived that both airlines were pushed into the red. Different working cultures, different fleets, overstaffing, overlapping networks, massive aircraft purchase, varying social benefits’ schemes within the airline were some of the issues which could only doom the deal from day one. Losses rose so rapidly that the government was finally forced to bail out the airline in 2012 to save it. And at the same time, negotiations to integrate Air India into Star Alliance collapsed at the end of 2011.

Air India’s troubles occurred also with its staff as pilots went on strike back to 2011. During that time, a section of Air India pilots went on a 10-day strike demanding better pay, resulting in the cancellation of dozens of flights. To regain market share, the airline decided to slash fares, slipping further into the red.

Air India showed losses of US$ 1.3 billion for the last fiscal year 2012-13. But since the middle of 2013, Air India seems to be back in business. First, the airline has made an effort to be more punctual and offer a better quality product on the ground and on board. The improvement in punctuality helped the carrier to regain market shares on the domestic market. Air India represents now 19.1 % of market share compared to 16.2% a year earlier. Air India management now believes that the carrier will be able to make its first profit by 2016-17.

Among the most important events of the year 2013 is the regular delivery of the airline’s fleet of Boeing 787 Dreamliner. Most of them are put into overseas flights including Europe as well as Australia. The Boeing 787 was an opportunity also to present to the public a new cabin concept in both business and economy classes. The relatively good financial and activity performance of Air India was greeted in early December by the official readmission of the carrier into the membership process in to Star Alliance. No dates have been announced yet but the most important is the injection of a dose of confidence into the airline’s orientations…

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Luc Citrinot a French national is a freelance journalist and consultant in tourism and air transport with over 20 years experience. Based in Paris and Bangkok, he works for various travel and air transport trade publications in Europe and Asia.

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