ID :
73314
Sat, 08/01/2009 - 18:44
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https://oananews.org//node/73314
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AI mulling cancellation of six B 777 aircraft deliveries
New Delhi/Mumbai, July 31 (PTI) Faced with slump in the
aviation sector and mounting government pressure to
restructure, cash-strapped national carrier Air India is
mulling cancelling delivery of six Boeing 777 long-haul
aircraft.
Air India Chairman and Managing Director Arvind Jadhav
and Boeing India President Dinesh Keskar held a meeting in
Mumbai on Friday at the Air India office to discuss the
matter.
"Air India is in dialogue with Boeing for cancellation
of six B-777 aircraft deliveries in 2010-11 and 2011-12 in
view of the current global aviation scenario," an Air India
spokesperson told PTI.
The national carrier, which is facing a severe cash
crunch, had ordered 111 aircraft, including 68 from Boeing, at
a total cost of over Rs 50,000 crore to augment its fleet.
The fleet renewal plan, including scheduled deliveries of
airplanes, is currently being reviewed by the carrier. As of
now, it has 46 aircraft on lease including 17 on
sale-and-lease back arrangement.
Air India Board, in its recent meeting, asked the airline
management to cancel the delivery of six aircraft. But the
letters have not been issued, an airline official said.
The airline, which is estimated to suffer a loss of Rs
7,200 crore in 2008-09, has been over burdened by its working
capital borrowings worth Rs 17,000 crore. It has overdrafts
from 15 banks. The carrier wants government to underwrite at
least Rs 10,000 crore of this burden.
The national carrier had sought government's help and
asked for equity infusion of about Rs 2,500 crore and a soft
loan of Rs 10,000 crore for five years.
However, the government said that any finacial help would
be extended only if the carrier undertakes restructuring
exercise and submits plans to return to profitability.
The government last week asked the Finance Ministry to
examine the extent of financial assistance to be given to the
airline, and also the Petroleum Ministry to extend the credit
limit on jet fuel for at least three months.
This was decided after the first meeting of a high-level
committee headed by Cabinet Secretary K M Chandrasekhar, which
vetted the ailing carrier's plans to cut costs and generate
revenue as also its fleet renewal plans to meet intense
competition in both domestic and international arena. PTI
aviation sector and mounting government pressure to
restructure, cash-strapped national carrier Air India is
mulling cancelling delivery of six Boeing 777 long-haul
aircraft.
Air India Chairman and Managing Director Arvind Jadhav
and Boeing India President Dinesh Keskar held a meeting in
Mumbai on Friday at the Air India office to discuss the
matter.
"Air India is in dialogue with Boeing for cancellation
of six B-777 aircraft deliveries in 2010-11 and 2011-12 in
view of the current global aviation scenario," an Air India
spokesperson told PTI.
The national carrier, which is facing a severe cash
crunch, had ordered 111 aircraft, including 68 from Boeing, at
a total cost of over Rs 50,000 crore to augment its fleet.
The fleet renewal plan, including scheduled deliveries of
airplanes, is currently being reviewed by the carrier. As of
now, it has 46 aircraft on lease including 17 on
sale-and-lease back arrangement.
Air India Board, in its recent meeting, asked the airline
management to cancel the delivery of six aircraft. But the
letters have not been issued, an airline official said.
The airline, which is estimated to suffer a loss of Rs
7,200 crore in 2008-09, has been over burdened by its working
capital borrowings worth Rs 17,000 crore. It has overdrafts
from 15 banks. The carrier wants government to underwrite at
least Rs 10,000 crore of this burden.
The national carrier had sought government's help and
asked for equity infusion of about Rs 2,500 crore and a soft
loan of Rs 10,000 crore for five years.
However, the government said that any finacial help would
be extended only if the carrier undertakes restructuring
exercise and submits plans to return to profitability.
The government last week asked the Finance Ministry to
examine the extent of financial assistance to be given to the
airline, and also the Petroleum Ministry to extend the credit
limit on jet fuel for at least three months.
This was decided after the first meeting of a high-level
committee headed by Cabinet Secretary K M Chandrasekhar, which
vetted the ailing carrier's plans to cut costs and generate
revenue as also its fleet renewal plans to meet intense
competition in both domestic and international arena. PTI
