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Air India Privatization
Looks like there has been some talk of privatization. Is it serious this time?
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more serious than they have been in the past....i'm still not sure how many successful bids will come in though....
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I am waiting for the unions to start the strikes. When that happens, then we know its serious.
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I think AI can be a very competitive airline if it does the following:
1. Fire 40-50% of it's staff - esp. management & ground staff. I do think they have great flight staff 2. Invest in IT - they have by far the worst IT in the world 3. Sells of all their excessive (govt. office mentality) assets including Air India building (Mumbai) and huge colonies etc. they've built across the country But none of that is going to happen. The govt. will probably not be able to absorb enough of the debt to make the airlines enticing to potential buyers. Then the airlines will be chopped up and sold in bits destroying it completely if it doesn't already collapse by then. |
Originally Posted by UA Fan
(Post 29592067)
Looks like there has been some talk of privatization. Is it serious this time?
. ..such as will the private airline thus created be able to provide the PM's airplane fleet for trips abroad? Will the babus be able to fly for next to nothing in premium cabins? Will politicians be able to demand first class when there isn't any? |
They have to split up the company and put all the good stuff in one and the liabilities and union contracts in the other. but that takes a lot of guts and is highly unlikely.
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Originally Posted by 678flyer
(Post 29604723)
I am waiting for the unions to start the strikes. When that happens, then we know its serious.
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Some of you who frequent other FT boards probably saw this discussion on EY:
Etihad interested in bidding for Air India (!) |
Anil and EY... That doesn’t instill a whole lot of confidence.... Where is the Tata, UK, SQ consortium!
And honestly I can’t see why anyone would want to take over AI. Given its liabilities, aging aircraft and other baggage I can’t see any one really bidding for it. It will be hard for the government to break up and sell esp. because of the unions etc. So it will trundle along... sucking up all our tax money. |
Originally Posted by PiperAtGatesofDawn
(Post 29652507)
Where is the Tata, UK, SQ consortium!
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I believe most people already know this, many airlines have been burnt by previous investments and would take a more cautious approach. Etihad being a prime example of having a history of bad investments. Any future investment by Etihad would require a proper due diligence and the current Air India sale model just doesn't make economic sense. I don't see any other airlines making a real offer (besides oh well lets explore it) for Air India under current terms.
The aviation market is a difficult one and to take on such a huge debt and also straddle along an interfering partner with a seat on the board just doesn't make sense. If the Indian government is serious about selling the airline off, it will have to change its terms to make it more attractive. |
Two months ago the talk was to break up AI / NACIL to sell at least some parts: https://uk.reuters.com/article/us-ai...-idUKKBN19U02T
Today the news came out that Discussions on a revival package for beleaguered state-run carrier Air India are at an “advanced stage”, the country’s junior aviation minister Jayant Sinha said on Wednesday. Ouch.... |
Originally Posted by oliver2002
(Post 30247174)
Two months ago the talk was to break up AI / NACIL to sell at least some parts: https://uk.reuters.com/article/us-ai...-idUKKBN19U02T
Today the news came out that https://reut.rs/2xTIuEO Ouch.... |
They can’t shut down AI. And in the current environment can’t sell AI for the foreseable future. They’ve missed their window of opportunity. I do like their service as long as it isn’t IROPs. They can certainly become profitable. They have the best routes esp. international. They can get the best slots etc. etc. They would need to fire their entire leadership first though. They aren’t causing other airlines to get screwed. They have the highest ticket prices on most routes. The main reason everybody is getting screwed is because of the high oil prices and Rs./$ rates. And none of the other airlines are willing to increase fares. With that kind of strategy the others would crash harder and faster if they got additional traffic from AI. |
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