Air-India To Shut Down 20 Foreign Offices

Air-India has finally decided to jump on the retrenchment bandwagon. The national carrier today announced it would close 20 overseas offline stations and downsize another 43 offline and online ones. This will eventually lead to 142 employees being laid off.

However, this does not match the scale of lay-offs by major global airlines which have so far retrenched 2,00,000 employees in the last month. The cost-cutting measure is a result of the downturn in passenger demand for international travel. It will lead to annual savings of Rs 21 crore, of which Rs 7 crore will come from the closure of certain offline stations.

The offline stations proposed to be shut include those at Barcelona, Boston, Montreal, Manchester, Budapest, Prague, Stockholm, Warsaw, Belgrade, Lyon and Nice. Stations to be downsized include those at Brussels, Madrid, Rome, Washington, Toronto, Birmingham, Lagos, Taipei, Auckland and Sydney.

Out of its 34 offline stations, A-I will be pulling down shutters in 20 and downsizing in another 10. Of the 76 employees at these stations, 52 will be retrenched with immediate effect.

A-I will also downsize 33 online stations, where its own flights or code-sharing ones with foreign carriers operate. This will lead to a savings of Rs 14 crore as nearly 90 employees, the ones based in India as well as locally recruited foreign nationals, will be retrenched in two phases.

The airline has had a very high ratio of staff to fleet. In 1999-00, the state-owned corporation spent Rs 1,007 crore on staff salaries, for a fleet of 26 planes. A-I is also understood to be phasing out three A300B4s, along with its remaining B 747-200s.