RAI BUSINESS SCHOOL

PROJECT ON

Marketing strategy of Air India To manage its funds

In partial fulfillment of

POST GRADUATE PROGRAM IN PLANNING AND ENTREPRENEURSHIP

SUBMITTED To SUBMITTED BY

Mrs.R.Hemalatha SANJEET KUMAR SINGH

SR. LECTURER 22/PGPPE/08E/168

RBS, Delhi Sem- IV, RBS, New Delhi

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ACKNOWLEDGEMENT 

I am grateful to those who have helped me in compiling the matter for this project. While I take this opportunity to thank all of them-they are too numerous to be mentioned in this brief preface.

I would like to acknowledge my deep sense of gratitude to Mrs. R.Hemalatha (Faculty , RBS Delhi) for her valuable help at all stage.

Lastly no words can adequately express my dept e.g. gratitude to my all faculty members of RBS DELHI and I also thanks my

friends for their support.

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TO WHOM SO EVER IT MAY CONCERN

This is to certify that Sanjeet Kumar Singh as a student of Rai Business School, Delhi, Batch (2008-2010) PTU University Enrollment number 22/PGPPE/08E/168 has completed Project on Marketing strategy of Air India To manage its funds

completed under my Guidance. I wish him all the very best in all his future endeavors. 

   Mrs.R.Hemalatha.

FACULTY GUIDE

                                                                        

                                                  

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INDEX

1. HISTROY OF AIR INDIA

2. SWOT ANALYSIS OF AIR INDIA

3. FINANCIAL PROBLEMS FACED BY AIR INDIA

4. STEPS TAKEN TO IMPROVE FINANCIAL POSITION

5. MARKETING STRATEGIES OF AIR INDIA

6. AMALAGMATION OF AIR INDIA LIMITED AND INDIAN AIRLINED WITH NACIL

7. FUTURE PROSPETS OF AIR INDIA

8. AWARDS AND RECOGNITIONS

9. BIBLOGRAPHY

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AIR INDIA

History of Air India

Air India is India’s national Airline. Air India’s history can be traced to October 15, 1932. On this day J.R.D. Tata, the father of Civil Aviation in India and founder of Air India, took off from Drigh Road Airport, Karachi, in a tiny, light single-engine de Havilland Puss Moth on his flight to Mumbai via Ahmedabad. Air India was earlier known as Tata Airlines. At the time of its commencement, Tata Airlines consisted of one Puss Moth, one Leopard Moth, one palm-thatched shed, one whole time pilot, one part-time engineer, and two apprentice-mechanics. Tata Airlines was converted into a Public Company under the name of Air India in August 1946. On March 8, 1948, Air India International Limited was formed to start Air India’s international operations. On June 8, 1948, Air India started its international services with a weekly flight from Mumbai to London via Cairo and Geneva with a Lockheed Constellation aircraft. In early 1950s due to deteriorating financial condition of various airlines, the Government decided to nationalize air transport. On August 1, 1953 two autonomous corporations were created. Indian Airlines was formed with merger of eight domestic airlines to operate domestic services, while Air India International was established to operate the overseas services. The word 'International' was dropped in 1962. With effect from March 1, 1994, the airline has been functioning as Air India Limited. Air India's worldwide network today covers 44 destinations by operating services with its own aircraft and through code-shared flights. Important destinations covered by Air India are Bangkok, Hong Kong, Jakarta, Kuala Lumpur, Osaka, Singapore, Tokyo, Seoul, Dar-es-Salam, Nairobi, Frankfurt, London, Paris, Birmingham, Abu Dhabi, Al Ain, Bahrain, Dammam, Doha, Dubai, Jeddah, Muscat, Riyadh, Kuwait, Los Angeles, Chicago, Newark, New York, and Toronto. Air India’s fleet consists of 38 aircrafts. These include 12 Boeing 747-400, 1 Boeing 747-400 COMBI, 2 Boeing 747-300 COMBI, 19 Airbus 310-300, and 4 Boeing 777-200.

In 1946, at the conclusion of World War II, the airline became a public company and was renamed Air-India Limited. In just two years, with the government having a 49 percent share in the company, the airline was flying further outside of India, with regular flights to Cairo, Geneva, and London. The line's name changed again to reflect its new scope of operations, becoming Air-India International Limited.

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India enjoyed more success in the airline industry than most other developing countries for a number of reasons. Whereas others had to rely on foreign pilots to fly their planes, Air-India used mostly native-born pilots. Similarly, skilled Indians were plentiful enough to maintain India's fleet as well as to train and supervise its personnel; many other countries had to go outside for this kind of expertise. Air-India benefited from these advantages along with its sister carriers.

Air-India first encountered competition for its routes in the early 1950s. Many new airlines were forming, propelled into business by the availability of inexpensive, war-surplus DC-3s. No fewer than 21 airlines had been established, with 11 of them licensed to fly the skies of India. A 1985 article in the Economist cited Tata's foresight of what this plethora of airlines could lead to: "The scene was well and truly set for the ultimate debacle."

To prevent that debacle from occurring, the Indian government in 1953 took control of all of the airlines within its borders. Along with the nationalization the government created two corporations. Indian Airlines Corporation, which merged Air-India Limited with six smaller lines, served the country's domestic travel needs. Air-India International Corporation flew routes overseas. By 1960 the international airline had routes to Singapore, Sydney, Moscow, and New York. By 1962, when the name was shortened to Air-India, it had become the world's first all-jet airline.

Beginning in the 1970s, however, Air-India saw difficult times. It suffered a net loss in three of the years between 1976 and 1985. The downturn in the world economy had a significant effect on air travel throughout the world, and India was no exception. In addition, the government kept a number of unprofitable routes open simply for prestige purposes--a strictly commercial airline may have closed those routes. Its flights to New York, for example, resulted in losses for a number of years, even though many of those flights were full. At one point an airline official estimated that only about ten percent of Air-India's passengers to New York were business travelers who would buy the more expensive seats. Flights to Canada were even less profitable, flying at around 55 percent of capacity. Another factor in the airline's financial problems was that, to compete for American and European travelers with American and European airlines, Air-India had to discount many of its fares. In addition, the airline depended heavily on local citizens--"ethnic traffic"--which generally meant lower fares.

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The routes that had proven to be most profitable for Air-India had been those to the oil-producing nations. Flights to the Persian Gulf accounted for 35 to 40 percent of Air-India's traffic in the mid-1980s. Working with Gulf Air, Air-India operated 60 flights each week between the Gulf and India. But even these routes saw profits fall, as revenue in the gulf states declined. Another problem was the shortage of tourists traveling to India. Communal violence and the assassination of Indian Prime Minister Indira Gandhi in 1984 kept tourism down. In addition, to combat the terrorism that was becoming a major problem at many of the world's airports, the government imposed heavy restrictions at airports, giving tourists another reason to stay away.

The darkest note in Air-India's history was the tragedy that took place in June 1985 when one of its 747s, on a flight from Toronto to Bombay, crashed to the sea with 329 passengers aboard. A Canadian Safety Board Report, addressing an inquiry by Indian High Court Judge Bhupinder Nath Kirpal, concluded that an explosive device was the probable cause of the crash. The board reported that an X-ray machine at Pearson International Airport in Toronto broke down before all the luggage had been checked. Nonetheless, the effect on the reputation of Air-India was severe.

Despite these problems, Air-India's productivity was high. By acquiring large-body airliners, its productivity almost doubled from the year 1974-75 to the year 1983-84. In terms of rupees, this productivity figure translated to a per-employee production of Rs 125,000 (US $16,000) in operating revenue in the 1974-75 year and Rs 439,000 in the 1983-84 year. In 1985 Air-India flew 8.1 billion passenger-kilometers (number of passengers times distance), a figure that prompted the International Air Transport Association to rank Air-India 15th out of 136 member airlines in passenger-kilometers on scheduled services.

Air-India lost $171 million in the three years beginning with 1994-95. The airline gained a reputation for poor service and poor on-time performance. The company initiated a generous incentive program to motivate employees, which proved successful. In addition, a computerized flight system and updated lounges and cabin interiors were added to update the company's image among customers. Management cut fares drastically and provided two-for-one discounts.

In the summer of 1997 the carrier negotiated code-sharing deals with Air France and Singapore Airlines. Streamlining the carrier's route network became an ongoing process. In fact, Air-India was notorious for constantly adding and

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dropping routes. Its network dropped Canada, Australia, and South Africa in an attempt to cut losses.

Air-India sought to offer its $150 million annual North American income streams as debt securities, pending the approval of a hesitant Indian government. The company also planned to raise cash (it already had reserves of more than $110 million) by selling its Hotel Corporation of India subsidiary, worth at least $220 million, as well as some older Boeing 747-200s, valued at $60 million.

Still, the company owed $900 million on new aircraft purchases. In spite of this impressive sum, Air-India found itself chronically short of medium-sized long haul aircraft, reported Air Transport World. Most of its planes were too large to be profitable on their particular routes, a liability previously covered by an especially profitable Persian Gulf market.

A recovery seemed to be in place upon the announcement of a quarterly profit of $10 million in the fall of 1997. More positive results were projected. Operating revenue was expected to reach Rs 4,189 million in 1997-98.

It was later announced that these results had been overly optimistic; the $10 million profit was in fact a $10 million loss. Managing Director Michael Mascrenhas announced the news after taking over from Brijesh Kumar, whose two-year term had just expired. Mascrenhas colored the news in the best possible light, noting in Air Transport World that Air-India had lost money only "six times in the last 43 years."

A planned merger between Air-India and Indian Airlines was canceled in spring 1998. Nevertheless, closer ties between the two carriers remained after the aborted deal. As Air-India cut routes, it maintained code-sharing deals with Air France, SAS, Singapore Airlines, and Austrian Airlines. Still, market share fell from 35 percent to 20 percent in 1997-98.

Reducing its annual payroll costs of $40 million was a top priority for Air-India, which had not found sufficient productivity increases to match its generous incentive programs. Air Transport World reported that Mascrenhas trimmed $23 million in other areas.

In spite of these savings, Mascrenhas predicted Air-India would not pull out of the red for another two years after projecting a 1997-98 loss of $44 million. To raise desperately needed cash, the airline offered its hotels and two 747 airliners for sale. 8

As the carrier planned for its $150 US/Canada security issue, the Indian government also was considering a rescue plan.

Incorporation

• Established in 1953 under Air Corporations Act• Became Public Limited Company in 1994• Registered Office : New Delhi• Head Office : Mumbai• Authorized Capital : Rs 500.00 Crores• Paid-up Capital : Rs 153.84 Crores

Subsidiary Companies

Air India has the following Subsidiary Companies with an Authorized / Paid-up Capital (in Rs. Crores) as under Authorised Paid-up.

(a) Hotel Corporation of India 41.00 40.00(b) Air India Charters Ltd. 30.00 30.00(c) Air India Air Transport Services Ltd. 100.00 0.05(d) Air India Engineering Services Ltd. 10.00 0.05

Subsidiary Companies

HCI(Hotel Corporation of India Ltd).

Centaur Hotels at Juhu, Mumbai Airport and Rajgir Sold. Centaur Hotel at Delhi, Chefair-New Delhi and Chefair-Mumbai.

Under Disinvestment

AICL(Air India Charters Ltd) New Airline Air India Express set-up under AICL All AI Express operations carried out on B-737-800 with a current fleet strength of 12.

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AIATSL (Air India Air Transport Services Ltd)

Incorporated in June 2003 Set up to undertake ground handling & other allied activities

Being operationalized at all domestic airports

AIESL (Air India Engineering Services Ltd)

Incorporated to undertake engineering and other allied activities To be operationalized

AIRCRAFT OF AIR INDIA

The total aircraft on order are 111 (68 from Boeing and 43 from Airbus). Aircraft on order include eight B777-200LRs, 15 B777-300ERs, 27 B787 Dreamliners, 18 B737-800s, 19 A319s, 20 A321s and four A320s. Of the 111 aircraft ordered, 24 Boeing (five B777-200LRs, five B777-300ERs, 15 B737-800s) and 21 Airbus (12 A321s and nine A319s) have been in the fleet so far.

Aircraft TotalAirbus A 310 8Airbus A 319 15Airbus A 320 43Airbus A 321 12Airbus A 330 2Boeing 737-800 22Boeing 747 6Boeing 737 5Boeing 777 14Airbus A 310 Freighters 4Boeing 737 Freighters 6ATR* 7CRJ 700 3

Total 147

Corporate Vision

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Vision To be among top five Asian airlines in terms of Yield, Profitability, Productivity, Size and Quality

Mission Focus on customer satisfaction. Grow with emphasis on sustained profitability. Provide exciting and satisfying work environment to retain and develop employees committed to Corporate Vision. Focus on social responsibility – environment & community.

Objectives Achieve unit revenue, unit cost, profitability, productivity and service level targets, based on benchmarked parameters.

Swot analysis of Air India.

Strengths of AIR INDIA

Air India has been the largest air carrier in India in terms of traffic volume and company assets.

• It owns the most updated fleet and competent repairs and maintenance expertise.

• Its information systems are advanced and compatible with its operation and service.

• It has a good reputation in both international and domestic markets, quality service and the age-old Goodwill that has still kept it alive in the interests of the rescue operators.

• Has financial backing of the Government.

Weaknesses of AIR INDIA

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Air India is operating across broad international and domestic markets competing with world leading giant airlines as well as local small operators. This lack of clarity on the strategic direction largely dilutes its capabilities and confuses its brand within markets.

• Low profitability and utilization of capacity.

• Growing Competitor base and entry of Low-Cost Carriers (LCC’s)

• The airline’s high-cost structure and the compulsions of being a public sector unit are the reasons and it had been making a loss and shall continue to make losses for some more quarters.

Opportunities of AIR INDIA

• India airline industry is growing faster and will continue to grow as the GDP increases, and the trend is predicted to continue once the slowdown recedes.

• Worldwide deregulations make the skies more accessible; the route agreement is easier to be achieved. The number of foreign visitors and investors to India is increasing rapidly.

• Complementary industry like tourism will increase demand for airline service. The Civil Aviation Ministry’s strong regulation and protection provides opportunities for consolidation and optimization.

• Customers are getting wealthier, tend to be less price-conscious and prefer to choose quality service over cost.

• Best time for introducing LCC’s.

Threats for AIR INDIA

• Air India faces imminent aggressive competition from world leading airlines and price wars triggered by domestic players.

• The Indian Railway Ministry has dramatically improved speed and services in their medium/long distant routes, attracting passengers away from air service, with prices almost at par with the low cost carriers12

Financial Problems faced by Air India.

Things began to deteriorate for AI since the mid-2000s, and in 2006-07, it reached serious proportions. In 2006-07, AI made a loss of Rs 541 cr and Indian Airline's loss was Rs 230 cr. In about two years, from March 31, 2007 to March 31, 2009, when AI and Indian Airlines merged, the losses rocketed to a mind-boggling Rs 7,200 cr. Aviation experts opine that the staggering eightfold increase in its losses in two years can be attributed to the manner in which aircrafts were leased, capacity was allocated to foreign carriers under bilateral agreements, ground- handling in important airports was given to a proposed joint venture, flights were withdrawn from profitable routes and pilots weren't sent for proper training, and not the least how AI and Indian Airlines were merged.

The losses really began from 2006 onwards when a decision to aggressively lease aircraft was taken to augment market share without conducting proper route study, marketing or pricing strategy. The upshot—in the last two years, from 2007 to 2009, AI kept five Boeing 777s and five Boeing 737s on ground at a loss of Rs 840 cr. Luckily for AI, Boeing could not meet the delivery schedules for its new B787 Dreamliners. If these aircraft had arrived on time, all of them would have been on the ground. Adding to the crisis, the merger between AI and Indian Airlines proved to be disastrous. Instead of resuscitating AI, the government has diverted funds to the next-to-impossible task of resolving the staggering mismatch between the two airlines in respect of the nature of operations, functions, roles, structures, cultures, pay scales, perks, and so on, with no synergy and economies of scale in sight. Sadly, even two years after the merger, the two parts of the merged airline do not have an integrated IT system. Besides these, the blame for the mess the airline finds itself in also rests squarely with the government. Constant bureaucratic interference in its functioning, a huge and unacceptable level of workforce, gross indecision in allowing fleet acquisition, growing inefficiencies, and competition from domestic private and foreign airlines ate into AI's market share. Aviation is a capital-intensive and high fixed cost business, which makes it much more vulnerable to business cycles; and it has also been severely battered by the current slowdown. The problem is clearly beyond cosmetic surgery such as forcing government employees to fly AI. AIR INDIA is now competing against more credible low cost carriers such as Spice jet, Go air, Indigo Airline, and Jetlite etc. Indigo Airlines remains Air India strongest

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competitor because of its competitive cost structure, strong brand name and ambitious growth plans over the next seven years. Air India also faces increased competition from Air Deccan low-fares subsidiary, Song. Moreover, major legacy airlines have been focusing on restructuring costs, which has improved theircompetitiveness. With costs restructured, the legacy airlines are becoming more formidable competitors in terms of increasing capacity, matching prices and leveraging their frequent flier programs. Increasing competition could adversely affect the company’s margins.

STEPS TAKEN TO IMPROVE FINANCIAL POSITION OF AIR INDIA

Disinvesting Government's equity in the Air India Limited through a process of disinvestment by sale of 40% equity to a strategic partner, upto 10% to employees and the balance by sale to financial institutions and/or on the share market.

Various measures were initiated in order to bring a turn around in the Company'sperformance. These measures mainly focussed on a reduction of the cost platform and the enhancement of revenue The measures were:-

- A programme of route rationalisation was introduced to optimise revenue involving curtailment of flights on marginal and loss making routes and the redeployment of this capacity to profit making routes;

- Secondary market were served by Joint Ventures and Code Share arrangements on 11 destinations;

- Emphasis was laid on route profitability by which stations generating higher yields got preferential allocation of seats;

- A two-class configuration of Executive and Economy Class was adopted on the B747-200 and B747-300 aircraft. More economy class seats were added on these and also B747-400 aircraft increasing overall seat capacity without any expansion in fleet size;

- Introduction of more rigorous space management techniques in order to optimise revenues;

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- Allocation of Cargo space based on higher revenue cargo uplifts and a preference for cargo carriage to on-line stations to reduce revenue losses through interlining;

- Strengthening Yield Improvement Programme;

- An Automated Revenue Management System(ARMS) for which a preliminary agreement has been signed with a vendor;

Market value of the Air India.

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MARKETING STRATEGIES OF AIR INDIA.

A Multi-pronged approach.

Capacity & Network Expansion – to increase market share & garner competitive strength. Achieve dominance in core markets (USA/UK/Gulf/SEA). Increase market access through strategic alliances.

Product Up gradation:

Deploy modern aircraft with state-of-art passenger amenities. Operate customer friendly schedules with increased network connectivityOperations Improvement – to reduce unit costs through. Increased asset (aircraft & manpower) productivity. Out-sourcing/hiving-off of non-core activities to subsidiaries. Technology up gradation. Benchmarking & adoption of “Best Practices”.

Product Upgradation.

Customer Friendly Schedules Planned.

High frequency services with standardized arrival/departures Network Connectivity. Single aircraft services from source markets. Expanded hub and spoke with own aircraft and from IC, Jet, Sahara Customer Service. Plans to match global standards of customer service through benchmarking, training & adoption of new technologies. Improvements with New Aircraft Product Improvements. New/Fresh Interior State of the art Seats/IFE Better on time performance Business Class pitch of 76”.

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Other Benefits Better Aircraft utilization Lower Fuel Consumption

LowerMaintenance Expenditure.

Operations ImprovementIncreased manpower productivity

Comprehensive HR Policy with focus on Motivation, Training & Development, Multi-skilling, Scientific job description & objective performance appraisal Special dispensations obtained from DGCA Operating Crew – Increased Flight Time Limits.Settlement to be reached with pilots

Cabin Crew - Executive crew to fly as per DGCA time-off regulations Computerization of Operating/Cabin crew scheduling Out-sourcing/Hiving-off Non-Core activities. Activities already out-sourced.– Printing Press– Crew/Employee Transport Potential for out-sourcing– Medical Services– Payroll/Revenue Accounting– Canteen– Civil Works

Hiving off to subsidiaries

Ground Handling

– Information Technology– Security– CargoTechnology Upgradation – IT Projects Revenue Management – PROS implemented Ticketing Time-Limit software implemented Direct connect with GDS’s Integrated computerization system forMMD

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Disposal of surplus/redundant inventory Implementation of Unit Load Device management system Disaster recovery site at remote location Air India Express IT Infrastructure DataMart for CRS sales data Ramp Assistance Billing System for GSD/Finance

Online Financial Information System (FINESS)

Strategic Relationships

• Strategic Alliance with Lufthansa (LH) MOU signed in August 2003 Joint capacity plan till 2007.

– Additional frequencies– AI : 22 (18 via Frankfurt to USA) - LH: 15• LH to provide AI commercially viable slots at Frankfurt• 19 slot pairs provided till winter 2004 (in exchange for 4 additional frequencies)• Reciprocal World-wide Free Flow Code Share & FFP Cooperation under implementation• Special Prorate Agreement implemented in November 2003• Cooperation in IT/MRO/Cargo being pursued• Air India developing relationship with other Star Alliance partners –United Airlines & Air Canada.

Joint Marketing Special Prorate Agreement Reciprocal code share FFP cooperation.

• Will pursue FFP cooperation with other domestic airlines in India togenerate incremental revenue streams• Will continue existing code shares with existing 14 airline partners &pursue such relationships with other airlines.• May also consider becoming a full-fledged member of a global alliance in the futureStaff costs constitutes nearly 19% of Air India's total cost. Many efforts were made to reduce the staff cost:18

FUTURE PROSPET OF AIR INDIA.

Keeping check and control on repetitive complaints and radically improving passengers service.

POLLUTION CONTROL MEASURES: The disposal of garbage/refuse collection is organised on regular basis with a view to avoiding pollution problems. Vehicles are sent to the Transport Section for regular preventive maintenance and regular PUC checks. In addition, anti-smoking signs are displayed in all the offices to discourage staff and visitors from smoking.

WOMEN'S WELFARE: A Women's Cell has been functioning at Mumbai and Delhi from September 1, 1993 in accordance with Government guidelines.

INDUSTRIAL RELATIONS: The Industrial Relations situation for the period under review was encouraging. There was a marked improvement in the general attitude of the employees with complete co-operation in the working of the Company.

TRAINING PROGRAMME: The Company has been imparting training invarious fields depending upon the need to technical and general categories of officers/staff.

Market tie-ups inter-carrier agreements such as code share etc.

Amalgamation of Air India Limited and Indian AirlinesLimited with National Aviation Company of India Limited.

The Government of India, on 1 March 2007, approved the merger of Air India and Indian Airlines. Consequent to the above, a new Company viz National Aviation Company of India Limited (NACIL) was incorporated under the Companies Act, 1956 on 30 March 2007 with its Registered Office at Airlines House, 113

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Gurudwara Rakabganj Road, New Delhi. The Certificate to Commence Business was obtained on 14 May 2007. Presently, the Board of NACIL consists of:

Shri Raghu Menon, Addl Secretary & Financial Advisor, Ministry of Civil Aviation.

Shri R K Singh, Jt Secretary, Ministry of Civil Aviation.

Shri Rajiv Bansal, Director, Ministry of Civil Aviation. The Scheme of Amalgamation of Air India Limited and Indian Airlines Limited with National Aviation Company of India Limited was approved by the Board of Directors of all the three Companies. Thereafter, the Meetings of Secured and Unsecured Creditors of Air India and Indian Airlines were held in New Delhi on 28 June 2007, in which the Scheme of Amalgamation was approved by the Creditors. The final hearing of the merger petition was held on 31 July 2007 wherein the last date for

submissions of objections was fixed on 8 August 2007 and the Order Ministry of Corporate Affairs is awaited.

The Authorized and Paid-Up Share Capital of the merged entity will be Rs.1500,05,00,000/- and Rs.145,00,00,000/-, respectively. It has been decided that post merger, the new entity will be known as “Air India” while “Maharaja” will be retained as its mascot. The logo of the new airline will be a red coloured flying swan with the “Konark Chakra” in orange placed inside it. The flying swan has been morphed from Air India’s characteristic logo “The Centaur” whereas the “Konark Chakra” was reminiscent of Indian’s logo. The Corporate Office of NACIL will be at Mumbai. The Government has approved the appointment of Shri V Thulasidas and Dr V Trivedi as Chairman & Managing Director and Joint Managing Director, respectively, of the merged entity, with effect from the date of merger..Awards and Recognitions

Air India was conferred the ‘Best West Bound Airline from India’ award at the Galileo Express Travel and Tourism awards 2005 function held in Mumbai on 7 December 2005.

The ‘Most preferred Brand’ Award in the international airlines category by CNBC AWAAZ, a leading Hindi business television channel, was presented

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to Air India at the AWAAZ consumer awards 2006 function held in New Delhi on 18 July 2006.

‘Reader’s Digest Trusted Brand Gold’ Award was presented to Air India at a function held in Mumbai on 18 May 2006.

Air India's security department became the first aviation security organisation in the world to acquire ISO 9002 certification (31 January 2001).

Air India's Department of Engineering has obtained the ISO 9002 for its Engineering facilities for meeting international standards.

Air India has also decided to discontinue the 40% discount scheme for employees and their families for domestic travel more than once a year. According to an insider, over 3,000 Nacil executives are entitled to the discounted fares. The source added there could also be future curbs on international business travel. Menon is also considering a scheme whereby 1,000 non-operational staff could take a sabbatical of between two and five years.

On January 1 this year, Air India had circulated a 25-point circular to senior officers on various cost-saving measures. They include payment of fuel reimbursement strictly through vouchers, abolition of children’s education allowance to officers posted abroad, reducing the cost of residential furnishing for EDs and GMs, and restricting foreign travel.

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BIBLOGRPHY

www.airindia.co.in

www. wikipedia .org

http://search.ebscohost.com

Business India

Economics Times

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