India creates new company to run merged airline

Seattle: The Indian government is forming an independent entity - National Aviation Company Ltd this month, that will run Air India following its merger with Indian Airlines, a top official told Gulf News.

"The National Aviation Company Ltd. will be the legal entity that will take over the current assets of both Air India and Indian Airlines and run the merged airline under the Air India branding," V. Thulasidas, chairman and managing director of Air India told Gulf News on Friday.

"The formation of this company will accelerate the pace of the merger and we expect the merger to be completed in a few months time."

Air India celebrated 75th anniversary this year, following its creation in 1932.

Indian government earlier decided to merge its state-run airlines, Air India and Indian Airlines to create one of the largest carriers in Asia.

Once merged the combined fleet strength of the merged carrier will be 115 aircraft with 111 more on firm orders, pending deliveries. The total staff strength of the merged carrier will be 34,000.

The new company will operate businesses in five major areas, creating a major passenger airliner under Air India branding, a low-cost model under Air India Express, a cargo airline under Air India Cargo, a maintenance, repair and overhauling operation (MRO) with Boeing and ground handling.

He has identified cargo as a major growth area for the airline.

"All these years we carried cargo operations in the bellyhold of the passenger aircraft. This is going to change now. With the dedicated cargo division, we expect a new fleet to emerge," Thulasidas said.

"We have already converted two passenger airliners into freighter and some more conversions will take plance in the coming years," he said.

He said the formation of the legal entity will be completed this month, following which the new entity will begin route restructuring and human resources planning.

On the flights to the Middle East, he said, "We will take steps to rationalise the route networks and remove excess capacity to where the routes are underserved," he said.

"In the Middle East also, we will make some adjustments."