For ground handling, maintenance & repair
New Delhi, Jan. 29:
Ground handling activity and maintenance and repair of Air India
aircraft will be done by two new subsidiary companies of the airline, which
will become operational from February 1 this year.
The proposal for setting up the two subsidiaries — Air India Transport
Services Ltd (AITSL) and Air India Engineering Services Ltd (AIESL) — has been
cleared by the Union Cabinet and is part of the turnaround strategy for the
State-run airline. Ground handling activities include checking-in passengers
and also ensuring that baggage is tagged and put on to the right aircraft.
The two subsidiaries will be board-run companies with the Air India
Chairman and Managing Director as Chairman.
The creation of the two new subsidiaries will see over 13,000 of the
25,000 permanent employees of the airline transferred to the AITSL and AIESL.
Sources said though the employees will be transferred on deputation to
the two ‘hived off’ subsidiaries, their working conditions, emoluments and
welfare perks would be protected.
Air India will provide Rs 375 crore as capital expenditure over three
years beginning this year to AIESL. Similarly, it will provide Rs 393 crore
over 12 years beginning this year to the newly set-up subsidiary which will do
the ground handling.
The two new companies will pay a royalty to Air India on the revenue
that they earn, but payment would start after a gap of a few years. AITSL and
AIESL will see Air India’s employee-to-aircraft ratio drop to a more
internationally acceptable level of 1:100 from the current level of 1:219.
Sources said AITSL would undertake ground handling activities for the
airline at all airports around the country except for those at Delhi,
Bangalore, Thiruvananthapuram, Mangalore and Hyderabad.
AITSL revenues are expected to rise to Rs 8,866 crore by 2022 from the
current level of Rs 700 crore while the revenue from ground handling will touch
Rs 3,100 crore in nine years from the current about Rs 800 crore.
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