CaseВ StudyВ: В AirВ IndiaВ crashes into troubles - Presentation Transcript 1 ) AirВ IndiaВ Crisis вЂ“ The NationalВ AirВ Carrier on a FreeFall 21st Summer 2011
2 . How it started
AirВ IndiaВ (Hindi: В а¤Џа¤…а¤°а¤‡а¤‚а¤Ўа¤їа¤Їа¤ѕ) can be aВ state-ownedВ flag company, the earliest and the largestВ airlineВ ofВ India. It is a partВ oftheВ Indian government-ownedВ AirВ IndiaВ LimitedВ (AIL) which can be renamed asВ AirВ IndiaВ Ltd. TheВ airline runs a fleetВ ofВ AirbusВ andВ BoeingВ aircraft servingВ Asia, В Australia, В EuropeВ andВ North America. Its corporateВ office is located in theВ AirВ IndiaВ BuildingВ atВ Nariman PointВ inВ South Mumbai. It is the 16th largestВ airline in Asia. В AirВ Indiahas two major home hubs atВ Indira Gandhi InternationalВ AirportВ andВ ChhatrapatiShivaji InternationalAirport. A global hub atВ Dubai InternationalВ AirportВ is currently being planned. a few. Some six decades ago that kicks off in august 1953, theВ IndianВ airtransport industry was nationalised to supply safe, smooth and economicВ airВ travel to the people. It involved ten warringВ airlines based on a work civilizations, horrendous basic safety record, terrible financial circumstances becauseВ ofВ cut-throat competition and inefficient management in certain. Thus enter existenceВ IndianВ Airlines Corp andВ AirВ IndiaВ Ltd to work domestic and international long haul services. The nationalisation was also expected to spur expansion, promote financial activity, rush assistance in timesВ ofВ natural calamities like overflow, famine and earthquake, create national the use and, first and foremost, serve as the 2nd lineВ ofВ defence in the eventВ ofВ war with another nation. It must be conceded that the nationalisedВ airlines fulfilled mostВ ofВ the expectationsВ ofВ the country, particularly at timesВ ofВ natural disasters and during the wars with China and Pakistan. This apart, getting remote placesofВ the country in to the mainstream simply by connecting all of them withВ airВ service need not be told. 5. Timeline
Founded by JRD TATA in 1932
1953В Indian Govt. attained major share
1960 purchased first boeing 707 and entered plane age
Renamed to В AirВ IndiaВ Ltd. In mil novecentos e noventa e seis
Was set for disinvestment in 2001 but it failed due to global slowdown. 5 years ago В theВ airlines started out showing signsВ ofВ financial distress. Approximated loss В Rs. В 770В croresВ (В 7. 7 billion). In 2007В AirВ IndiaВ andВ IndianВ Airlines combined along with their subsidiaries to formВ AirВ IndiaВ Limited. Senseless mergerВ ofВ the two wingsВ ofВ theВ airline took reduction figures to В Rs7, two hundred crores (В 72 billion) simply by March 2009 This was followed by various restructuring plans which are not at all effective. May 2011: Already showing under economical crunch becauseВ ofВ the ten day pilot strikeВ В AirВ IndiaВ finds itself within a tight spotВ as State-run oil businesses вЂ“ theВ Indian Oil Corporation, the Bharat Petroleum Firm Ltd. as well as the Hindustan Petroleum Corporation will not supply the energy to the bleeding carrier. Intended for the economic year 2010-2011 a lossВ ofВ Rs 7000 crore is anticipated. 5. Via a businessВ caseВ standpoint it should possess ceased to use a few years back again had this been a private company. six. Problems (part 1)
* Was not prepared to get competition it started having after the liberalizationВ ofВ IndiaВ economy in 1990. * Puffed up workforce. В AirВ IndiaВ has 28, 500 permanent personnel, double Jet's headcount. That operates 127В aircraft, compared with Jet's 115. 2. Highest Personnel perВ Aircraft in the world 200: one particular where as desirable is 130-170: 1 .
5. Bad supervision and defective policies provides broughtВ AirВ IndiaВ to this crisis level. * A cultureВ ofВ complete sloth in administration.
* Total lackВ ofВ Ownership.
2. LakeВ ofВ responsibility intended for results and failures.
5. Deeply inbedded corruption in every levels.
* InsteadВ ofВ renting out unused portionsВ ofВ iconic Nariman Point building for the large sum, the debt-riddenairline is paying Rs 22 lakh each month because of its upkeep; 15В ofВ its 23 floor surfaces are lying down vacant. several. Problems (part 2)
2. Old gas guzzlingВ airВ crafts still running....