After failing in attempts to privatise state-owned Air India and Indian Airlines last year, New Delhi is seeking consultants to help draw up a long-term business plan for the carriers.
The Ministry of Civil Aviation early in September sought technical bids from consultants. A 15-year business plan is being sought for the two airlines. Work will begin in the form of a "benchmarking analysis" of the carriers against others such as Lufthansa, Qantas Airways, Singapore Airlines and Thai Airways International, says the ministry.
Consultants will also be required by the ministry to review contracts with employee unions agreed over the past 10 years and compare them with those of other airlines, "keeping in view the Indian labour laws and practices."
Studies will at the same time cover the possible "hiving off into separate companies" internal divisions such as aircraft maintenance and engine overhaul, and non-core divisions responsible for security, medical and catering. Alongside this, a "manpower rationalisation" will be looked at.
The consultants will finally be asked to come up with "detailed steps required for operational integration of Air India and Indian Airlines" in "various" unspecified areas, and to develop recommendations for a wide-ranging financial restructuring.
The two carriers are considered by most in the industry to be overstaffed and inefficiently run, and in desperate need of restructuring. Air India has a workforce of 16,600, while Indian Airlines employs 22,000.
The government said it would privatise both last year but disqualified the last two bidders from the running for Indian Airlines and saw Singapore Airlines walk away from a planned bid for Air India with its local partner Tata.
Source: Airline Business
