A major change is taking place in Air-India.  A change of guard at the top with another new CMD taking charge; another one who has absolutely no experience of the highly competitive commercial world.

The old CMD, who will stay for another month handing over to his successor, spoke with Anjuli Bhargava on August 22, 2015 and “tooted his own horn” of his achievements during the four years that he had been at the helm of the airline.  Did he speak of his failure to complete the merger which is now in its 8th year?  A BIG RESOUNDING “NO”. We still have many loose ends.  The integration of Pilots’ salaries is a major case in point.

Did he speak of the losses incurred during the past 3 years. Again, a BIG RESOUNDING “NO”. The NET loss during these years has been:

2012-13 5,490 crores

2013-14 5,380 crores

2014-15 5,547 crores

Did he achieve a reduction in expenditure?  Since losses have not decreased, one can only surmise that there has been no decrease in expenses.  At the same time, it is interesting to note that the loss in in 2014-15 increased by 3.1% over the previous year, while revenues were almost static (0.6%).

In other words, AI’s expenditure has risen which must raise eyebrows since Fuel costs, which represent a major portion of expenses have come down substantially due to the drop in oil prices.

To cap it all, a recent Air-India Press release states in its last paragraph that “There has been, however, a nominal increase in the aircraft maintenance cost, which during 2014-15 stood at Rs.1145 crore as compared to Rs.830.81 crore on 2011-12.

The actual increase is 37.95% and I question who in his sane mind would consider this as “a nominal increase”.  Who are you kidding, Mr. Nandan?

Mr. Nandan also listed as one of his achievements the discontinuance of the flights to Canada which were operating at a loss.  Then, how does he justify the Australian operations which have been losing millions of dollars from the get go?  These flights were started during his tenure.

So, my parting words to Mr. Nandan are - You did a great job in following orders of your superiors in the Ministry.   Your annual appraisals must have reflected how good you are in following orders and instructions and hence, have been rewarded by a promotion.  Congratulations and I hope you will continue the same “Ji Hazoori” wherever you are posted.

Promod Gupta sent me a Blog written on August 28, 2015 by the incoming CMD and I was delighted to read how highly he speaks of the teamwork and the great efforts put in by his staff in ITDC and the Madhya Pradesh Tourism Department during his stewardship of these Organizations.

I have always maintained that Air-India’s biggest asset was its staff.  To be quite factual, that was the case while I was still with the airline.  Morale took a steep decline during the 1980s and thereafter.  

If I can take the liberty of making any suggestions to the new CMD, it would be that his first task would be to raise morale and motivate the staff.  

Here, I would like to quote an extract from the Blog of the incoming incumbent:

QUOTE

I often remember with great pride, the rise from abyss of men during the days ITDC was being hived off. The tremendous zeal that my men then displayed to pull the organization out of the red and compete with the best in the private sector often make my eyes swell with tear and pride.

UNQUOTE 

I hope the new CMD can say the same when it comes time to relinquish the reins at Air-India.  

Hopefully, the new CMD will exercise independent judgement and not succumb to the orders and instructions from politicians and bureaucrats, or am I wishing for too much?

The new CMD faces many major issues and some of these will be (not necessarily in order of priority):

1. Interference and orders from politicians and bureaucrats.

2. Morale - this is so low that one wonders if ever it will reach bottom.

3. The Merger - it has been almost 8 years and till now there are many loose ends.  For example, the parity of salaries of pilots.  Medical benefits for spouses of retired staff has been equalized only last month.

4. Quality of service. It is at an all time low.  Flights have taken off without TOILET PAPER. 

5. On time performance - Air-India is at the bottom or very close to it of all the Indian airlines.

6. Decision making - no one wants to take any decisions because:

A. He or she does not get any credit for doing so

B. Initiative is not rewarded 

C. Lack of motivation

  7. Utilization of aircraft - the turnaround time must be cut down to get better     utilization and hence, lower breakeven load factors.

  8. Operating aircraft on routes for which they have been designed.  For   example, the new 787 aircraft is being operated on short haul domestic routes.  This aircraft was designed to operate long haul flights for better economics, not short haul.

  9. Discipline - the cabin crew are “showing the finger” to Management.  They either do not show up for flights or report sick.  Now we hear that they will be paid an “INCENTIVE” to operate Hajj flights on time.  Shades of the old PLI given to all staff to do what their job functions require.

The new CMD has a very unenviable task and I hope he has the stomach and the guts to stand up to the demands of the politicians and bureaucrats.