With input cost on rise, state-owned Air India is losing cash on almost all routes except two sectors ? Kolkata-Yangon and Kolkata-Kathmandu ? out of 175 it operates. The airline is not meeting even fuel cost on eight sectors.
?Based on April-September figures, Air India is meeting fuel cost in case of 109 services but not meeting cash cost. The airline is not meeting total cost on 56 services,? civil aviation minister Vayalar Rravi said in the Rajya Sabha on Thursday.
Air India is expected to post a loss of R7,375 crore (before tax) in the financial year ending March 2012 mainly due to spiralling fuel prices, competition from low-cost carriers and high interest burden on account of working capital and aircraft loans.
The cash-strapped airline has a working capital loan of R22,368 crore besides R21,412 crore it has borrowed for financing its fleet acquisition. The airline owes nearly R4,200 crore to its vendors.
Air India is awaiting government nod on its turnaround and financial restructuring plans which envisages equity infusion to the tune of R6,750 crore in the current financial year.
In its bid to monetise its assets the airline management has decided to explore cash and lease back options for its B787 aircraft the delivery of which start soon. ?The board has approved sale and lease back for B787s. Now it would need government approval,? Air India chairman Rohit Nandan said after the airline board meeting on Tuesday.