Flag carrier Air India (AI) is trying to keep most of its planes up in the air for a longer time. The carrier is benchmarking itself to the best of international airlines to keep its fleet flying for at least 12 hours every day, instead of the average six and eight hours span.
This would mean a far better on-time performance instead of the 78% it averaged in September. Jitendra Bhargava, director (PR) at AI, said, ?Though the official data for October is yet to be released by the Directorate General of Civil Aviation, we are confident of crossing the 85% mark. We are keeping a check on parameters by which our timings will improve substantially from the current levels.?
In airline parlance, this is known as on-time performance or OTP, a statistic that CEOs track closely. This is made possible by reducing the turnaround time or the time within which an aircraft, which has landed, gets ready for another departure, after making sure that basic activities like positioning of the aircraft, cleaning, cabin dressing, security check and uplift of meals are performed. Since each flight departure involves a long sequence of such activities, the end result means the aircraft has to deliver with clockwork precision. That in turn leads to far better revenue realisation per aircraft, say AI officials through improved load factors and increased yields.
Bhargava said the daily OTP for domestic flights in August averaged 81.4%, with some stations recording 100% on-time departures on several days. ?This is significantly higher than the average on-time performance of 76.5% in July and 76.4% in August,? he added.
Till recently, the aircraft utilisation at AI was anything between six and eight hours, depending on the aircraft type, but the carrier is making all efforts to enhance it to over 12 hours, benchmarking the timings against international standards.
Simultaneously, AI is working on plans to reduce its expenditure on employees by Rs 500 crore per annum, with a newly-formed committee re-examining wage and other agreements in consultation with the unions attached to the airline. The cash-strapped airline’s employee cost currently is over Rs 3,000 crore annually and the airline is targeting a reduction in employee cost to the tune of Rs 500 crore per annum. At present, National Aviation Company of India Ltd, the government-run airlines company that was formed with the merger of Indian Airlines and Air India last year, has around 31,000 employees.
The national carrier, which is seeking government bailout of about Rs 5,000 crore and has a debt of Rs 16,000 crore, has never received budgetary support, except for the initial equity of Rs 150 crore by the government. The airline needs funds to finance acquisition of 111 aircraft, for which it has already placed orders.