In a bid to cut losses, Indian Airlines has decided to wind up its Boeing 737 operations in the eastern region. The airline will hive off its Boeing fleet to Delhi-based subsidiary, Alliance Air.
Indian Airlines sources told Business Standard the transfer of operations will ensure maximum utilisation of the Boeing aircraft and enable it to minimise losses incurred from operations in the region, particularly in the North East.
The shortage of Boeing commanders due to a mass exodus of pilots to private airline companies had brought down aircraft utilisation from 1,657 hours to 1,589 hours in 1995-96. Alliance Air, which hires pilots on contract, was conceived as a solution to the Boeings which were lying idle, sources said.
The Boeing 737 are being provided to Alliance Air on a wet lease of around Rs 1.07 crore per month.
This includes the major maintenance, spares and ground handling services being provided to the subsidiary by Indian Airlines. This move by Indian Airlines will see its annual revenues surge by over Rs 12 crore.
The Delhi-based subsidiary has pegged its projected turnover for the current fiscal at Rs 220 crore and Rs 550 crore for the next fiscal. Its total fleet will comprise of 12 Boeings out of which two will be for maintenance purposes.
There are also plans to acquire smaller aircraft after which the airline will launch a formal schedule of its flights.
According to an Alliance Air source the flights that will be operated from February 10 will only be on an interim basis till problems are sorted out.
Alliance Air already operates six Boeing flights from Calcutta to Bhubaneswar, Visakhapatnam, Chennai, Port Blair, Dimapur and Jorhat.
Alliance Air will fly to Imphal, Silchar, Dispur and Patna from February 10, totally replacing Indian Airlines in this region.
The national carrier will henceforth operate only on trunk routes between Calcutta and other hub stations.
Indian Airlines will also gradually withdraw the rest of its Boeing operations in the remaining parts of the country in favour of Alliance Air, sources added.
