Will Air India be Able to Come Out of this Situation

A national airline, it paved the path of many private carriers like Jet and Kingfisher to serve the Indian market. AI is a pioneer in the Indian aviation industry. It was one of the best airlines in Asia and the world.

That was then. The recession of 2007-2009 took a toll on Air India, as with the case of many airlines globally. Alitalia, the Italian carrier went bankrupt and till date, about 30 airlines all across have shut down their shops or are looking for buyers. Air India is no exception. Being a premier public sector company, it has employed a large number of men and women for various operations. Their future looks in grave doubt now.

A week ago, the union civil aviation minister Praful Patel gave Air India a 30 day ultimatum to cut the fat and restructure it completely. He also mentioned disinvesting a sizeable amount, and get private players to come in. AI in reality, is an overstaffed organization. Of late, the professional standards, upon which the very ethos of this organization rested, have taken a nosedive.

Due to the high oil price of H1 2008, the global recession and the swine flu, Air India's backbone is almost broken now and it is on the brink of being wiped out. More than 30,000 employees' June salary has been delayed to 15th of this month and the top management had to forego their entire June salary.

Air India got its first major shake up today as two of its senior directors getting reassigned and the government questioning the recruitment of 300 retired AI officials in the past 3 years. No one knows what happening next. The future of every AI employee hangs in the balance, as they eagerly wait for the next update. The restructuring plan is falling in place and many senior heads are going to roll. Many lower level employees going to lose their jobs. British Airways, last month had asked about 1000 employees to work without any pay. Not sure if the same model is going to work with Air India though. There is a cloud of uncertainty in every quarter of this great airline.

The steps taken by the government and the airline are in the right tune. Though restructuring may not be the only step, it must ensure to give their laid off employees a decent severance pay, and ease out non performing assets. Voluntary retirements can be an option as well. Tough times call for tougher measures. This is the only way by which we can revive the great brand, Air India.