30 Minute Interview

‘Air India must retain its status as a sophisticated legacy carrier’

V Thulasidas CMD, Air India

Amidst revamping the brand, overseeing the carrier's biggest fleet acquisition and ramping up operations of AI's low cost subsidiary, he still has the time to tell Bhisham Mansukhani all about it

How has Air India Express fared in its first year of operation?

Rather well. It has already made a profit and we will now look at consolidating it in the Middle East, then on to South East Asia before launching it domestically. Unlike conventional low cost carriers, there is limited service and food offered on board. Air India Express is flying the B737-800 which is also a new aircraft and we will adhere to this single type for future fleet acquisition

Why the need for a revamp of AI now?

We felt that AI had lost out somewhat in terms of standards due to no additional fleet and an intense emphasis on flights to the Gulf. The objective now therefore is to revive the product on the back of a monumental fleet expansion. Now while the passenger base that wants low fares is being serviced by Air India Express, Air India must retain its status as a sophisticated legacy carrier. It is being repositioned as a premium airline, using wide-bodied new aircraft with high level of onboard and on-ground service.

Will AI offer first class against the recent trend of that class being phased out?

While some airlines have been phasing out the first class and in turn enhancing their business class, AI will retain first class on long haul flights. The B747-400 does have a first class product that will be further spruced up. The Airbus A310 is currently undergoing refurbishments in all classes followed by the Boeing 747-400, which will be brought to the level of the new aircraft.

Do you think that the general perception with regard to AI is changing?

There is a conscious effort to make that happen. Now, while certain deficiencies still exist there are also some indigenous strengths. We ensure that the elderly in need of wheelchairs for transfers are accommodated.

Will the ability to hedge fuel costs help AI cut down operational costs?

Fuel costs can be hedged to an extent but most costs are outside the purview of cost management. The areas that can be controlled come under the pressure of plummeting air fares. The joke doing the rounds these days is that every one involved with airlines make money except the airline. We will begin hedging from 2006 but on a very small scale as it is a high-risk exercise.

Will AI and AI Express be two parallel brands?

The low cost brand will have to be completely separate from Air India. That process is still to be completed at the top management level which is still the same for both airlines. We do have separate front line staff. There will always be a strong bond, though.

Will AI consider the A380 in the future?

We did evaluate the A380 as well as the B747 and decided that neither would make commercial sense at this point. The geographical spread of India dictates that we get more rather than larger aircraft.

Are there plans to increase AI's current network?

We have plans to open up more stations in the US, Europe and Africa following the induction of new aircraft. There are plans to increase flights out of Bangalore, Chennai, Hyderabad, Amritsar and Kolkatta.