India creates independent unit to run merged airlines

Seattle: The Indian government is forming an independent entity - National Aviation Company Ltd - this month to run Air India following its merger with Indian airline, an 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 and run the merged airline under the Air India branding," V. Thulasidas, chairman and managing director of Air India, told Gulf News.

"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.

The government earlier decided to merge its state-run airlines, Air India and Indian, to create one of the largest carriers in Asia. Once merged the combined fleet strength of the carrier will be 115, with 111 more planes on order, pending deliveries. The staff strength of the merged carrier will be 34,000.

Growth areas

The new company will operate businesses in five major areas, creating a major passenger airline 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 with Boeing and ground handling.

Thulasidas identified cargo as a major growth area.

"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," he said.

"We have already converted two passenger aircraft into freighters and some more conversions will take place 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."

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