Wednesday, October 12, 2011

Can Nandan turn Air India around?


Mumbai: Air India’s chiefs all have a singular ambition when they take charge—turn the carrier into a viable business.

So too with Rohit Nandan, who took over as chairman and managing director of the state-run airline in August. Not the easiest of tasks, given that it has about Rs. 42,570 crore of debt, is expected to make a loss of about Rs. 7,000 crore this financial year and is battling for passengers at home and abroad amid a slowing economy. The recent history of Air India is replete with leaders who have failed in their bid to turn it around. Will Nandan’s fate be any different?

“I certainly don’t have a magic wand...but I am doing all basic things to attain operational efficiency and financial freedom,” Nandan, 54, said in an interview. “I have met at least 200 employees in the last few weeks and they are fairly positive about the airline.”

The Indian Administrative Service officer is reworking the winter schedule, reconfiguring aircraft, outsourcing non-core functions and meeting employees every week to boost morale.

Predecessor Arvind Jadhav, too, sought to achieve this through meetings and a series of letters explaining his vision for the airline that has at least Rs. 22,000 crore in accumulated losses. But he had to leave after alienating both employees and the government.

The government’s propensity to put bureaucrats in charge of the airline adds to the scepticism in some quarters.

“You need a qualified turnaround specialist to revive Air India,” said Hormuz P. Mama, an independent aerospace analyst. “You need rigorous cost-cutting measures to save Air India. With this bloated workforce (30,000 workers), it is difficult to turn around Air India.”

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5 comments:

  1. Informative post and I don’t understand why all airlines are in trouble these days is this due to increase in price of fuel.

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  2. Air India is very much under the debt and the govement is also looking for ways to take it out of debts and it seems very difficult to trun around air india.They have cut expenses and work efficiently.

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  3. Its going to be very tough as Air Inida is under too much so now government has to come up with some serious issues to take it out of debt.45,000 crore is too much money and even government is scary about this.

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  4. Its very difficult task has has, he has to manage the Air India very tactfully as its under too much debt.Keep sharing such useful article with us.

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  5. Air India is under too much of debt and we have to see when this aviation company comes out of the debt.Now we have new chairman and managing director so we can only hope that he will do some good work.

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