New Delhi: These are difficult times for all airlines but perhaps the worst hit of all is Air India - India's government airline.
On Friday Air India will come out with a turnaround plan but the question is: Can Air India really turn around?
Show us the plan and we will show you the money, that's what the government told Air India a few weeks ago when the airline sought a bailout.
Now, the Maharaja is ready with its revamp plan and is all to set to announce it on Friday. But the question is: Will Air India really be able to turn around its fortunes?
Take a look at the financial mess it is in:
- In May this year Air India needed Rs 16,000 crore as working capital
- Another Rs 14,000 crore to maintain its fleet
- And Rs 15,000 crore more to take delivery of the remaining planes of the 111 new planes it had ordered two years ago
In fact, this internal note makes it every clear.
It says: "Considering the present financial ratios and losses of Air India it would be impossible to get further working capital support from banks on normal business parameters."
Over the last couple of years the airline has steadily lost its market share and things only got worse after Indian Airlines and Air India merged. This year alone the airline is expected to lose over Rs 7,000 crore.
"Give them autonomy and then either Air India runs on profit or they should pack their bags," said Sharad Yadav, former Civil Aviation Minister.
Air India is now on everyone's radar and quite clearly the airline either performs or perishes.