Air India’s USA operations are loss making!

Yesterday, I wrote about the loss-making scenario of Air India which they are trying to paint as they are breaking into a profit. However, that is not exactly true given that they seem to have undermentioned a loss of about US Dollars 1 billion over 3 years. I was trying to get more details on this, and through another report, I see that there are details of how the losses of Air India seem to be done by their international network.

Per FirstPost,

India might take pride in saying that Air India is its international airline of repute, but financially the airline’s international operations have bled it dry. As per C&AG, the deficit in recovery of total costs on international operations was Rs 3,755 crore in 2015-16 versus a much lesser Rs 1,759 crore in domestic operations. The airline operated 68 international service, 154 domestic services. Contribution of services to the USA was the highest in international segment; they also brought in a fair share of the losses.

Per this report, the USA operations of Air India brought in a cumulative loss of INR 6,685 Crores in one year itself (April 2015 to March 2016), which is about a billion dollars of losses right there!

  • Air India’s Ahmedabad – Mumbai – Newark flight (AI191) brought in a cumulative loss of INR 2,411.46 crores (roughly US Dollar 360 million). This is the deficit the flight incurred in not meeting its total costs.
  • The Delhi – San Francisco flight, which was launched 3 times weekly in December 2015, made a loss of 43.74 crores within the first three months of operations.  (roughly US Dollar 6 million)

Per another old report from the Hindustan Times,

  • On the flights to Australia, served by the Boeing 787, the airline lost over INR 300 Crores (USD 45 million)
  • On the flights to Rome/Milan, the airline lost INR 150 Crores during the first ten months of 2014-15 (USD 22 million)
  • On the Ahmedabad-Mumbai-Newark route, the airline lost more than INR 430 Crores in a single year (USD 65 million). The INR 2,411 Crores loss is a cumulative loss.
  • The Amritsar – Delhi – Birmhingam route has made a loss of INR 120 crores (USD 18 million)

Truly there is more than what meets the eye with respect to Air India. I’m seriously wondering should I give them a lot more business to pull them out of a loss (not me alone, okay?), or should I even bother with them at all and they keep sucking the taxpayer money on their bailout, in which case people like you and me are still paying for them.

What would you do if you were an Indian citizen and paying for the mess called Air India?

Comments

  1. Sad to see our tax money getting wasted on this piece of crap. Its unfair to the public and other airlines who don’t necessarily have the Indian government for bailout.
    My tax money goes into running this airline and I try hardest to never fly with AI.
    I wish they had excellent product to justify their losses, but they can not even boast about that.

  2. For internatinal routes likes USA , europe. Passenger generally opt for gulf airlines coze they have a good brand & better sevice than our own. AI should do a revamp; starting from the color for there aircraft. Jet looks way good ; Still now. An they should concentrate more on local routes & fewer international routes.

  3. Air India has incurred a debt of 60000 crores. At 10% a year the opportunity cost is 6000 crores.

    When you consider the costs of a coronary bypass or dialysis most Indians cannot afford it and choose to die rather than inflict the crushing debt this might entail. 6000 crores would save 2 million lives per year. Over Modi’s tenure of 5 years 10 million lives could have been saved.

    The cost of AI is equivalent to one of the largest Holocaust the world has ever seen. But since we are in India instead of privatizing we will continue to talk, talk and talk

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