Air India trims operations as losses mount

NEW DELHI: In A bid to check mounting losses, Air India (AI) has undertaken a major route rationalisation programme that will see the airline withdrawing flights to Jakarta and Kuala Lumpur and restructuring operations to New York, Toronto, Bangkok and Dhaka.

Forced by high losses due to rising fuel prices and low yields, AI is adopting business strategies to face not only global competition but also from Jet Airways.

Due to the unprecedented rise in jet fuel prices, AI is expected to suffer a net loss of around Rs 2,000 crore in 2007-08 as per revised estimates, official sources said, adding that there would be no respite in 2008-09, which would be another difficult year for the national carrier.

Besides withdrawing flights to Jakarta and Kuala Lumpur, it has withdrawn operations from Bangkok on the Shanghai, Hong Kong and Tokyo routes. However, its flights would operate to the Malaysian capital from Mumbai and Delhi via Bangkok, they said.

While the national carrier has restructured flights to Dammam to operate point-to-point services, Jet Airways and JetLite have not yet been granted traffic rights to fly on the India-Dammam route.

Air India���s services to New York have been restructured with the daily flights terminating in Delhi, thereby saving cost of operations on the Delhi-Mumbai sector.