Air India

Air India & Indian Airlines

The Airline was set up under the Air Corporation Act 1953 with an initial capital of 32 million rupees and operation started on 01 Aug 1953. It was established after legislation came into force to nationalize the entire airline industry in India. Air India took over the international routes and Indian Airlines Corporation the domestic and regional routes. Lately it had a fleet of Air Bus A 300,A 320 and Boeing 737.The economic liberalization process initiated by the Government in early 1990’s ended the Indian Airlines domination of air transport industry. It faced tough competition from Jet Airways, Air Sahara, East West Airlines, Skyline NEPC and Modiluft.

Indian Airlines network spanned from Kuwait in the west to Singapore in the East and covered 75 destinations 57 in India and 20 abroad. Indian Airlines flight operations centre around four main hubs- the main metro cities of Delhi, Calcutta, Mumbai and Chennai

India shows a huge potential for air traffic increase due to the boom in IT and IT enabled service sectors. CII estimates that the international and domestic air traffic is expected to grow from 42 million to 90 million in the next couple of years. After the opening up of the sector competition has become much stiffer from the private and foreign players. Air India and IAC realized the importance of customer satisfaction and started improving their services

Under the ministry of civil aviation decision was taken to merge Air India and Indian Airlines into one Airline in 2007. At the time of merger it may have seemed the right thing to do. However there have been problems since then as the culture of the two airlines varied widely and resulted in a long strike by the pilots resulting in a loss of almost 600 crores. A number of issues are involved post-merger which are yet to be resolved. Air India has had four chairmen in the last six years with none biting the bullet on tough decisions. The merger brought...