AI unions want fleet expansion deferred

MUMBAI: Three unions have demanded Air India to defer fleet expansion in order to fight liquidity crunch. The representatives of the unions have put forward their demand to the firm���s chairman and managing director Arvind Jadhav on Saturday.

They met Mr Jadhav a week after the state-run Air India had asked its senior executives to voluntarily forego salaries and productivity-linked incentives in July due to an ongoing liquidity crisis. Earlier this month, Air India deferred the salary and incentives of all employees for June by 15 days.

The carrier has taken delivery of four planes till this month. A few more are supposed to be added to its fleet this year. Air India plans to add 111 planes in the next three years with an estimated investment of Rs 45,000 crore.

A senior official of Nacil, which runs Air India, said there is a strong possibility that the airline may go slow on taking possession of new planes in order to resolve its credit problem. Mr Jadhav will take a final call on this shortly, he said.

The Air India spokesperson declined to comment. It was learnt that the recently formed cost cutting committee has tabled its proposal to overcome the credit crisis to the top management on July 3. Nacil suffered a loss of about Rs 5,000 crore in 2008-09 and has a working capital overdraft of Rs 15,000 crore.