‘Air India expects 20% hike in revenue in FY14’
Beleaguered Air India's fortunes seem to be shoring up with the airline estimating that its total revenue would go up 20 per cent by the end of the current financial year.
The national carrier's total revenue is expected to go up from Rs 16,130 crore in 2012-13 to Rs 19,393 crore in 2013-14, Civil Aviation Minister Ajit Singh said at a function here to celebrate completion of Air India's 65 yeas of service on the London route.
Reflecting a turnaround earlier than planned, the airline is determined to achieve the target of growing its operating revenue to by over 20 per cent, Singh said.
According to the minister, Air India also estimates that its EBITDA (earnings before interest, taxes, depreciation and amortisation) would increase from Rs 19.45 crore in 2012-13 to Rs 1,040 crore in the current fiscal.
'We are restructuring Air India's operations. Right now there are only two Indian air carriers who are doing international operations -- Jet and Air India. Jet is making profit but Air India is incurring losses. So we are trying to reduce our costs through various ways,' he said.
Air India has re-launched commercial flight of the Dreamliner between Delhi and London on 22 May and plans to expand its global network using the Boeing 787 Dreamliner aircraft as the state-of-the-art aircraft took to the skies again after being grounded since 17 January after reporting several battery fire incidents.
The minister avoided replying when asked if Air India plans to charge passengers extra for seat allotments and additional baggage, but said 'we have asked for a study on the global practise. I am told that it is a global practise to charge extra for providing extra services.'
'See, we are hybrid. We have the economy class in which so far we are not charging, but in case of business class we are charging extra for providing services like extra leg rooms, flat beds etc., so lets see,' Singh said.
Maintaining that FDI is good for the civil aviation industry and Indian air carriers, he said 'our banks are financially over-exposed to the sector. They are not so keen to give loan to airlines. That is why FDI is a welcome step.'
Singh said the loss-making routes of Air India have been reduced from 69 per cent to 25 per cent, while its on-time performance in 2012-13 has been 77.1 per cent (domestic 80.2 per cent and international 70.8 per cent). There has also been a 'significant increase' in business and first class passengers which has contributed to growth in yields on both domestic and international networks, he said.