India-based Airlines - Air India Announces First 787 Route

Just realized that I forgot to put this up! Y'all will probably be interested:

http://aeroblogger.com/2012/02/22/air-indias-first-787-route-melbourne/
Air India has announced its first longhaul 787 route! Pending government approval, Air India will fly between Delhi and Melbourne nonstop. This would be the only nonstop service between Australia and India.

Encouraged by the Australian government, Air India has reportedly received many concessions from the governments of Victoria and New South Wales, as well as the Airport Authority of Sydney and Melbourne. These concessions will improve the profitability, and hopefully will make the route worthwhile to Air India.

The service is planned to begin at the end of the year, in third quarter 2012-13. Air India expects to receive its first 787 in May. The aircraft will be configured in a 2 class, 256 seat configuration. 18 Business Class seats and 238 Economy Class seats.It will operate shorthaul (unclear whether domestic or international) services with the aircraft first, to get various staff groups familiar with the aircraft.

Personally, I think this route choice is brilliant. Over 100,000 people fly between Delhi and Melbourne each year. That means that Air India could basically fill the aircraft with more profitable O&D passengers (passengers not connecting). Seats left over could be filled by connecting passengers going to Europe and the Middle East. The vast amount of demand means that Air India will be able to fill its planes at reasonable prices, hopefully making the route profitable.

What The Air India 787 Will Look Like When Completed; Source: FlightGlobal

The route is approximately 5,500 nautical miles, which is well within the range of even the early-build 787s. That means that Air India will be able to carry max payload, allowing it to fly cargo in addition to passengers. This will also contribute to the profitability of the flight.

An interesting thing to look at is the timing of this announcement. It has come just after the Air Transport Association of America, Delta Air Line and Air Line Pilots Association International filed a joint lawsuit trying to block the US Export-Import Bank from financing Air India’s purchase. Those groups assert that the loans should be blocked because they are negatively impacting US-based companies. They claim that the 787s will allow Air India to dump more capacity on routes to the USA, hurting the American Aviation Sector.

Announcing a route to Melbourne seems like an excellent way to defend against these allegations. A route that doesn’t even come close to the USA, which has the potential to be very profitable, is a great argument that the 787s will help Air India, but not hurt the American Aviation Sector.

Now if there's one plan that should be blocked, it's AI's MEL fantasy. Someone needs to file an injunction toute de suite.

There is a limit to how much taxpayer money is wantonly flushed down the toilet.

Now if there's one plan that should be blocked, it's AI's MEL fantasy. Someone needs to file an injunction toute de suite.

There is a limit to how much taxpayer money is wantonly flushed down the toilet.

I tried to stay positive.. :) Don't want to write off the plan quite yet - the 787 is truly a fantastic aircraft that might make it work... Hopefully.

I tried to stay positive.. :) Don't want to write off the plan quite yet - the 787 is truly a fantastic aircraft that might make it work... Hopefully.

And Air India is truly a hopeless airline that will make it fail... Most certainly.

And Air India is truly a hopeless airline that will make it fail... Most certainly.

Sure, if their current longhaul ops are any indicator. But as I said, I'm trying to stay positive :):)

There's a very fine line between positive and delusional! :p

I'm afraid AI crossed the point of no return a while ago. No matter what they improve and how they change, it's too late.

Without pointing fingers and playing a blame game, there is zero justification to keep AI alive anymore. The plug needs to be pulled, on the MEL plan as well as on the airline as a whole.

Euthanasia is the most humane option here.

There's a very fine line between positive and delusional! :p

I'm afraid AI crossed the point of no return a while ago. No matter what they improve and how they change, it's too late.

Without pointing fingers and playing a blame game, there is zero justification to keep AI alive anymore. The plug needs to be pulled, on the MEL plan as well as on the airline as a whole.

Euthanasia is the most humane option here.

I agree partly. I think AI's longhaul network needs to go, or get a really, really good makeover. However, their domestic and shorthaul international ops are actually in decent shape, and I don't think pulling the plug on it would be a good idea.

Oh dear..... Not this again!!

I'll believe this route is on when an AI bird touches down at MEL. Not when it leaves DEL but when it touches down at MEL

Oh dear..... Not this again!!

I'll believe this route is on when an AI bird touches down at MEL. Not when it leaves DEL but when it touches down at MEL

i agree....this has been going on for a while....let me know when it lands in mel....

Here's some of my previous thoughts on this issue

http://www.flyertalk.com/forum/16102462-post18.html

http://www.flyertalk.com/forum/16104622-post22.html

http://www.flyertalk.com/forum/16107238-post26.html

Ofcourse some of the points are a touch irrelevant with the alliance ambitions of AI/IT falling apart, but the crux of those posts still stands, IMHO

do remember that qf cancelled their bom-sin leg so you don't have any bom-oz connectivity other than through one hop .. [sin was a 5th freedom stop on the same bird]

nonstop to oz would shave several hours off flight and connection time - AI is a crappy airline or not doesnt matter as much as the far lower amounts of jetlag

do remember that qf cancelled their bom-sin leg so you don't have any bom-oz connectivity other than through one hop .. [sin was a 5th freedom stop on the same bird]

nonstop to oz would shave several hours off flight and connection time - AI is a crappy airline or not doesnt matter as much as the far lower amounts of jetlag

Even with the QF BOM-SIN leg, the connectivity was always a one hop affair. QF52 originated in BNE, and thrice weekly, continued to BOM. Its departure from SIN for BOM was timed to allow pax connecting from MEL/SYD to connect with a 2 hour transit.

The AI DEL-MEL flight would be fantastic if flying between those two cities, but if originating in a city other than MEL and heading to a city other than DEL, then the AI flight becomes a 2 stop affair, as opposed to a 1 stop hop via Asia/Middle East on TG/SQ/CX/MH/EK/EY

Some of those carriers have multiple flights a day between SYD/MEL/BNE and their hub cities, as well as their hub cities and BOM/DEL and other tier 1/2 Indian cities. They can afford to capacity dump on this route much better than AI and its once a day 787 flight can. Which would be a further argument against AI entering this route.

but if originating in a city other than MEL and heading to a city other than DEL, then the AI flight becomes a 3 stop affair, as opposed to a 1 stop hop via Asia/Middle East on TG/SQ/CX/MH/EK/EY

You mean 2 stop?
Origin-MEL-DEL-Destination

I'm sure many people will still be more willing to connect with SQ or MS or Thai.
Besides, their thoughts on connecting traffic through DEL, maybe if it was 9W but I don't think that at least from a European perspective AI attracts much connecting traffic to destinations outside of the subcontinent.
That doesn't mean that I think that it will be a failure of the route. With the 787, I think that this route could turn out to be quite successful. What would aid it would be a codeshare with Virgin Australia or Lufthansa.

What would aid it would be a codeshare with Virgin Australia or Lufthansa.

They've already got a codeshare agreement with LH. If they expanded it so LH had its code on FRA-DEL-(AI)-MEL, the route could be very, very successful indeed.

They've already got a codeshare agreement with LH. If they expanded it so LH had its code on FRA-DEL-(AI)-MEL, the route could be very, very successful indeed.

Do you mean if LH had its code on just the DEL-MEL flight (what I was suggesting) or both the AI operated FRA-DEL and DEL-MEL flights?

They've already got a codeshare agreement with LH. If they expanded it so LH had its code on FRA-DEL-(AI)-MEL, the route could be very, very successful indeed.

In case the code share doesn't work out, AI should just directly operate the FRA-DEL route. In fact, why stop there? They should go for the Kangaroo route: LHR-DEL-MEL

In case the code share doesn't work out, AI should just directly operate the FRA-DEL route. In fact, why stop there? They should go for the Kangaroo route: LHR-DEL-MEL

That's the plan. However, I don't think AI will be able to command any type of yield premium at all since it is not part of an alliance. Codesharing extensively will "fix" that problem...

Do you mean if LH had its code on just the DEL-MEL flight (what I was suggesting) or both the AI operated FRA-DEL and DEL-MEL flights?

LH already has its code on FRA-DEL. However, if a passenger is flying FRA-DEL-MEL all on AI (LH code or not), LH will lose money - they pay the administrative costs, but get nothing out of the fare.

LH already codeshares with SQ (and, I Think, TG) on this route. If the success of this route for AI depends on tagging codeshares then that alone would indicate that this is not a well thought out strategy.

LH already codeshares with SQ (and, I Think, TG) on this route. If the success of this route for AI depends on tagging codeshares then that alone would indicate that this is not a well thought out strategy.

AI doesn't think that success depends on codeshares. We think that it depends on codeshares.

Honestly, I think that AI would deliver a very competitive product and an excellent airport to transfer in. However, I don't think that others, as in those buying tickets, will understand that. Right now, Air India's biggest problem is its brand. Perceptions change slowly. If they want to fill the plane with customers, they will need to differentiate their product somehow. And currently, their strategy to do that is to charge dirt cheap fares. Not sustainable.

I was talking to an exec at Air India the other day, and he mentioned something interesting - they want Kingfisher to stay alive, and keep cancelling flights. Apparently, pax rebooked from Kingfisher to AI are finally understanding that AI is a much better operation now than it was. AI has been getting lots of positive comments from those pax, and they are hoping to turn those pax into repeat customers.

LH already has its code on FRA-DEL. However, if a passenger is flying FRA-DEL-MEL all on AI (LH code or not), LH will lose money - they pay the administrative costs, but get nothing out of the fare.

Are you serious? No administrative costs outweigh the ISC earned, let alone any SPA premiums earned from a codeshare sector. That is why codeshares are so popular - they create a win-win situation for both marketing and operating carriers.

Are you serious? No administrative costs outweigh the ISC earned, let alone any SPA premiums earned from a codeshare sector. That is why codeshares are so popular - they create a win-win situation for both marketing and operating carriers.

Ahh, that's what I was missing. Never even thought of ISC..

Yeah, then it probably would make some sense to codeshare on this flight for VA/DJ and LH... Maybe AI will even be able to get itself a codeshare partner in BD/LX/OS as well.

As for SPAs, I assume you're talking about codeshare commissions that might be included in the agreement?

I was talking to an exec at Air India the other day, and he mentioned something interesting - they want Kingfisher to stay alive, and keep cancelling flights. Apparently, pax rebooked from Kingfisher to AI are finally understanding that AI is a much better operation now than it was.

In a country of blind, a one eyed man is king.

Also, as long as the one daily flight remains open to interference from ministers and babu's with regards to schedule and delays (again maybe this doesn't happen any more); the perception will remain that AI is a relic of the socialist era.

I'm sure AI has changed (in the interest of full disclosure, I have never flown AI, and don't intend to unless there's a loaded gun to my head, or the price really is that attractive compared to its competition - I have however flown on Jet and Indigo domestically in India), but the perception sticks, and if I had to get anywhere on time, I'd likely not pick AI as my first choice of airline to fly on.

While AI may wish to compete on price, it needs to take into account the fact that other carriers like EK, SQ and CX can afford to dump seats on this sector, as between them they fly 10+ wide bodies each day between their Hubs and Sydney/Melbourne, and almost twice a day each from other mainland state capitals. And even then, many would probably go with SQ or CX if they were within a 100$ or so of AI.

The problem with Air India is the fact that this route will be once daily, point to point route, with considerable peaks and falls in the traffic through the year. I wish them luck, but I don't think the market has space for another player on this route.

Ahh, that's what I was missing. Never even thought of ISC..

Yeah, then it probably would make some sense to codeshare on this flight for VA/DJ and LH... Maybe AI will even be able to get itself a codeshare partner in BD/LX/OS as well.

.

BD are being bought by IAG (holding company of BA and IB), which is allied and still committed to IT, so a definite no-no with that one. But as you said, LH, VA/DJ, LX, OS and TK codeshares would work out pretty well.

By the way, what is ISC?

In a country of blind, a one eyed man is king.

Also, as long as the one daily flight remains open to interference from ministers and babu's with regards to schedule and delays (again maybe this doesn't happen any more); the perception will remain that AI is a relic of the socialist era.

I'm sure AI has changed (in the interest of full disclosure, I have never flown AI, and don't intend to unless there's a loaded gun to my head, or the price really is that attractive compared to its competition - I have however flown on Jet and Indigo domestically in India), but the perception sticks, and if I had to get anywhere on time, I'd likely not pick AI as my first choice of airline to fly on.

While AI may wish to compete on price, it needs to take into account the fact that other carriers like EK, SQ and CX can afford to dump seats on this sector, as between them they fly 10+ wide bodies each day between their Hubs and Sydney/Melbourne, and almost twice a day each from other mainland state capitals. And even then, many would probably go with SQ or CX if they were within a 100$ or so of AI.

The problem with Air India is the fact that this route will be once daily, point to point route, with considerable peaks and falls in the traffic through the year. I wish them luck, but I don't think the market has space for another player on this route.

I think it has room for 9W but not AI, as you say, although AI is not bad, perception sticks. I know that especially here in Britain, most PIOs/OCIs/NRIs have AI as a last resort! But most quite like 9W.

BD are being bought by IAG (holding company of BA and IB), which is allied and still committed to IT, so a definite no-no with that one. But as you said, LH, VA/DJ, LX, OS and TK codeshares would work out pretty well.

By the way, what is ISC?

Sorry, probably should have clarified...

ISC = Interline Service Charge
SPA = Special Prorate Agreement

If you want to do some reading on the specifics of codeshare agreements, I can email you a document that explains it in detail.. It's not simple stuff though (150+ pages long) ;)

Sorry, probably should have clarified...

ISC = Interline Service Charge
SPA = Special Prorate Agreement

If you want to do some reading on the specifics of codeshare agreements, I can email you a document that explains it in detail.. It's not simple stuff though (150+ pages long) ;)

Thanks, could you? I'll private message you my email address.

Thanks, could you? I'll private message you my email address.

You have an email in your inbox.

You have an email in your inbox.

I've got it. Thanks:)

Just realized that I forgot to put this up! Y'all will probably be interested:
An interesting thing to look at is the timing of this announcement. It has come just after the Air Transport Association of America, Delta Air Line and Air Line Pilots Association International filed a joint lawsuit trying to block the US Export-Import Bank from financing Air India’s purchase. Those groups assert that the loans should be blocked because they are negatively impacting US-based companies. They claim that the 787s will allow Air India to dump more capacity on routes to the USA, hurting the American Aviation Sector.

Announcing a route to Melbourne seems like an excellent way to defend against these allegations. A route that doesn’t even come close to the USA, which has the potential to be very profitable, is a great argument that the 787s will help Air India, but not hurt the American Aviation Sector.
http://aeroblogger.com/2012/02/22/air-indias-first-787-route-melbourne/
This is hilarious. This is a very strange argument. Delta has one flight to India. It cancelled its DEL flight more than a decade ago. United dropped India altogether, With this logic, no financing should be provided to any airline with potential of flying between U.S. in India. India-U.S. is one route on which demand as exceed capacity for most of the last 15 yrs.

Hey adding capacity to an Australian, British, German or any NATO city may hurt airlines of their ally. So AI should not be allowed to purchase any aircraft. :D

Why don't they suggest that the open skies agreement be scrapped?

This is hilarious. This is a very strange argument. Delta has one flight to India. It cancelled its DEL flight more than a decade ago. United dropped India altogether, With this logic, no financing should be provided to any airline with potential of flying between U.S. in India. India-U.S. is one route on which demand as exceed capacity for most of the last 15 yrs.

Hey adding capacity to an Australian, British, German or any NATO city may hurt airlines of their ally. So AI should not be allowed to purchase any aircraft. :D

Why don't they suggest that the open skies agreement be scrapped?

The argument is that the Ex-Im bank finances airlines around the world, but is prohibited by law from financing US based airlines. Ex-Im provides financing at a margin significantly less than the major financial institutions. From a cost (and debt service) standpoint, US airlines are at a significant disadvantage in the acquisition of aircraft. I don't think it's a strike against AI, but rather trying to make a point that US airlines suffer from not being able to access the cheaper financing provided by Ex-Im.

The argument is that the Ex-Im bank finances airlines around the world, but is prohibited by law from financing US based airlines. Ex-Im provides financing at a margin significantly less than the major financial institutions. From a cost (and debt service) standpoint, US airlines are at a significant disadvantage in the acquisition of aircraft. I don't think it's a strike against AI, but rather trying to make a point that US airlines suffer from not being able to access the cheaper financing provided by Ex-Im.

That's a perfectly valid argument. The problem is that instead of complaining that they don't get access, they are complaining that other airlines do. Trying to block AI from getting their 787s is a disgusting political move to make.

The argument is that the Ex-Im bank finances airlines around the world, but is prohibited by law from financing US based airlines. Ex-Im provides financing at a margin significantly less than the major financial institutions. From a cost (and debt service) standpoint, US airlines are at a significant disadvantage in the acquisition of aircraft. I don't think it's a strike against AI, but rather trying to make a point that US airlines suffer from not being able to access the cheaper financing provided by Ex-Im.

Law suit against a law is liable to fail. You Challenge the law not actions taken under the law. Changing a policy or admiosnirratuve rules is another matter though.
Whichever way you look at it, EXIm bank is designed to help industries/businesses other than airlines. There are many agencies whose charter prevents them from operating with the U.S. For example, CIA may not operate with the U.S. or on a U.S. citizen , but out side the U.S., kit can sponsor assassination. Without getting into the reasoning for what CIA isn;t allowed to do, the ExIM financing is designed to increase exports, not local sales. Whether it afects AI is not the issue. The point is its a frivolous lawsuit destined to fail.

That's a perfectly valid argument. The problem is that instead of complaining that they don't get access, they are complaining that other airlines do. Trying to block AI from getting their 787s is a disgusting political move to make.

It maybe a valid argument on the street, then only marginally so, but has no legal basis.

It maybe a valid argument on the street, then only marginally so, but has no legal basis.

Of course the argument is on the street. I'm not a lawyer ;)

That's a perfectly valid argument. The problem is that instead of complaining that they don't get access, they are complaining that other airlines do. Trying to block AI from getting their 787s is a disgusting political move to make.

It maybe a valid argument on the street, then only marginally so, but has no legal basis. Delta claims that AI's launch of nonstop BOM-JFK killed it's JFK-BOM is ared herring too. Delta was enchanted with it's hub ATL. Is it Delta's claim that it could not compete with an airline that even Indians hate? :D

Is it Delta's claim that it could not compete with an airline that even Indians hate? :D

Hey!... :D

That's a perfectly valid argument. The problem is that instead of complaining that they don't get access, they are complaining that other airlines do. Trying to block AI from getting their 787s is a disgusting political move to make.

Whether the argument about it hurting them is right or wrong, trying to block AI from getting their 787s is disgusting. Too protectionist for centre-right America.

It maybe a valid argument on the street, then only marginally so, but has no legal basis. Delta claims that AI's launch of nonstop BOM-JFK killed it's JFK-BOM is ared herring too. Delta was enchanted with it's hub ATL. Is it Delta's claim that it could not compete with an airline that even Indians hate? :D

:D true

Has anyone heard anything new about the route?

Has anyone heard anything new about the route?

Yes. A friend of mine at fleet planning says that there is a ton of paperwork that AI has to send to various ministries. After that is taken care of, assuming there are no objections, AI will announce the route.

This paperwork to ministries requirement is incredibly destructive to AI - it's make-work that just slows every process down. For example, AI wanted to lease out its 777s like 9W, but the potential buyers all left when they found out that it would take months for the various approvals to come from various ministries.

There is more newsflow about where the 787 is going. to Frankfurt and London before it flies to MEL and SYD. Here is some food for thought

http://boardingarea.com/blogs/livefromalounge/2012/04/14/more-speculation-on-where-is-the-air-india-787-flying/

Wirelessly posted (BlackBerry9000/5.0.0.822 Profile/MIDP-2.1 Configuration/CLDC-1.1 VendorID/102)

Has anyone heard anything new about the route?

Yes. A friend of mine at fleet planning says that there is a ton of paperwork that AI has to send to various ministries. After that is taken care of, assuming there are no objections, AI will announce the route.

This paperwork to ministries requirement is incredibly destructive to AI - it's make-work that just slows every process down. For example, AI wanted to lease out its 777s like 9W, but the potential buyers all left when they found out that it would take months for the various approvals to come from various ministries.

No. Air India slow themselves down. Have been doing so for decades.

As if it's the first time they've had to file paperwork and seek permission. AI apologists will find fault with everyone and everything; except Air India.

And I hope the ministry, or the Finance Minister or whoever crashes Air India's Melbourne fantasies before they start. Those 787s will lose less taxpayer money decorating the Palam tarmac than they will flying to Australia.


As for London and Frankfurt (sorry can't figure out multi-quote on phone) that Trash of India graphic talks about Bombay to Frankfurt, a flight that doesn't exist. It also says the (hopefully fantastic) Melbourne flight will start in July. Its nearly the end of April, so when do they plan to start advertising and selling seats? After the first flight has flown? And when did Sydney get added to their Australian fantasy?

Seriously, winding-up proceedings need to be filed against this bottomless cesspit toute de suite.

Seriously, winding-up proceedings need to be filed against this bottomless cesspit toute de suite.
^ Some of us were doing the math - the current bailout figure of INR 30K crores is enough to provide each village in India with a dedicated RO plant and clean water. Each village. Alternatively, the same amount can be used to enrol each BPL household in the RSBY program - with a 30K cashless medical insurance cover, for 10 years

Instead, we spend INR 1 crore/AI employee to keep them in their jobs and the national pride afloat. Talk about priorities!

the national pride afloat.

the national pride, not!

^ Some of us were doing the math - the current bailout figure of INR 30K crores is enough to provide each village in India with a dedicated RO plant and clean water. Each village. Alternatively, the same amount can be used to enrol each BPL household in the RSBY program - with a 30K cashless medical insurance cover, for 10 years

Instead, we spend INR 1 crore/AI employee to keep them in their jobs and the national pride afloat. Talk about priorities!

You think that is bad?

The budgeted defence spending for the whole year is just 6 times the value of this one payment to Air India.

This one payment to Air India is over half the value of the entire year's national education budget.

The amount allocated towards health for the whole year is less than this one payment to Air India.

the national pride, not!
National beggar more like.

Actually, this isn't one payment. It's lots of payments, spread over 8 years.

That doesn't mean that this is a ridiculously large sum of money for the government to waste, but the government will actually be annually spending 1/48th of the defense budget, or ~1/15th or the education budget, etc.

There are so many better uses of this money. It's really sad to see it wasted this way.