Air India turnaround looks difficult as Dreamliners report problems
Air India was betting on the Dreamliners to turn around. The Dreamliners have faced one problem after another ever since their induction into the Air India fleet.
When Air India got its first Boeing 787-800 Dreamliner in September 2012, the national carrier was in deep trouble. Just months before, the national auditor had criticised Air India's purchase of 111 planes mainly through debt. Relations between the airline's management and staff unions were frosty. Air India hoped the new fuel-efficient aircraft would help it cut losses on its international operations and, in turn, place the airline firmly on the flight path to profitability. That is taking longer than expected.
The Dreamliners have faced one problem after another ever since their induction into the Air India fleet. In January, the US Federal Aviation Administration ordered the grounding of all Dreamliners worldwide - Boeing is an American company - due to battery problems. The aircraft resumed operations in May. Since then, several aircraft have reported snags such as overheating of appliances on board, brake system problems, false alarms going off in the cockpit, windshield cracks and a falling fuselage panel. This has forced Air India to allay any safety concerns relating to the aircraft. These incidents have now raised doubts if Air India will be able to regain its lost ground on international routes on the back of the Dreamliners.
Air India, however, seems unperturbed . The carrier has launched an aggressive promotional campaign for the Dreamliners. "Do not rush to write an obituary for the Boeing 787 and along with it [that of] Air India," says an airline executive, who does not want to be named. Air India Chairman and Managing Director Rohit Nandan also defends the aircraft. "All new planes have initial problems. Once these teething troubles settle, the operations become smooth with time," he says.
Dinesh A. Keskar, Senior Vice President in charge of sales in the Asia Pacific and India, said the US company is working with Air India engineers to resolve the problems reported on the Dreamliners. Boeing has 979 Dreamliners on order worldwide. "Today, we are at 97 per cent dispatch reliability. All other Boeing aircraft have a goal of 99 per cent or higher. Our goal is to get there and we are putting all our resources to get there," says Keskar.
Air India says the Dreamliners will be the main fleet for the airline in the future. The airline is exploring an option of buying a newer version of the Dreamliner - the 787-900 - with a larger capacity. It has ordered a total of 27 Dreamliners and has taken delivery of 10 so far. It will add another six by January and the remaining by 2015.
Air India executives also say the airline will go slow on the number of hours it flies the aircraft so that its engineering team gets enough time for essential software upgrades and all necessary certifications. Air India's Dreamliners fly at least 13 hours a day, while airlines such as ANA of Japan fly the aircraft for nine hours. "These are just procedural issues," says an Air India executive in the engineering department. "There is no safety issue."
For Boeing, Air India is important not just because it is a client. The state-run carrier is important also because it is a testament to Boeing's claim that these aircraft will help airlines make their long-haul routes profitable by cutting fuel costs. An Air India executive, who does not want to be named, says the Dreamliner is generating better cash margins because it is 30 per cent more fuel efficient than the Boeing 777. "That is why we are replacing the 777 one by one as this will cut down our operations cost," he says. "The only international route that is not profitable on the 787 is Australia but that is because it is a new route. Forward bookings are good here as well. We will be switching from the 777 to the 787 on the London route soon."
But not all in the beleaguered airline share the enthusiasm. Some executives question the entire induction process of the Dreamliner. A senior trainer at Air India, who does not want to be identified, says the problems are due to the lack of experience of pilots, lack of preparedness by the airline to induct the aircraft, and wrong decisions taken by Air India while deciding the configuration of the Dreamliner with Boeing.
Another Air India executive points to the incident where a fuselage portion fell off a plane. "The portion of the fuselage falls off because a rivet was not properly screwed or the rivet was not the right one or was not in its proper place or there was no correct equipment to put the rivet," he says. "The aircraft might be new but the attitude with which the person is working on the aircraft is still old."
The challenge for Air India is not only justifying the aircraft purchase and using it efficiently to turn profitable. Changing that old attitude is essential, too.
(Follow the author on Twitter: @manishasinghal)
The Dreamliners have faced one problem after another ever since their induction into the Air India fleet. In January, the US Federal Aviation Administration ordered the grounding of all Dreamliners worldwide - Boeing is an American company - due to battery problems. The aircraft resumed operations in May. Since then, several aircraft have reported snags such as overheating of appliances on board, brake system problems, false alarms going off in the cockpit, windshield cracks and a falling fuselage panel. This has forced Air India to allay any safety concerns relating to the aircraft. These incidents have now raised doubts if Air India will be able to regain its lost ground on international routes on the back of the Dreamliners.
Air India, however, seems unperturbed . The carrier has launched an aggressive promotional campaign for the Dreamliners. "Do not rush to write an obituary for the Boeing 787 and along with it [that of] Air India," says an airline executive, who does not want to be named. Air India Chairman and Managing Director Rohit Nandan also defends the aircraft. "All new planes have initial problems. Once these teething troubles settle, the operations become smooth with time," he says.
Dinesh A. Keskar, Senior Vice President in charge of sales in the Asia Pacific and India, said the US company is working with Air India engineers to resolve the problems reported on the Dreamliners. Boeing has 979 Dreamliners on order worldwide. "Today, we are at 97 per cent dispatch reliability. All other Boeing aircraft have a goal of 99 per cent or higher. Our goal is to get there and we are putting all our resources to get there," says Keskar.
The experienced flier: Dinesh A. Keskar, Senior Vice President for Sales, Asia Pacific and India, Boeing. PHOTO: Nishikant Gamre
Air India says the Dreamliners will be the main fleet for the airline in the future. The airline is exploring an option of buying a newer version of the Dreamliner - the 787-900 - with a larger capacity. It has ordered a total of 27 Dreamliners and has taken delivery of 10 so far. It will add another six by January and the remaining by 2015.
Air India executives also say the airline will go slow on the number of hours it flies the aircraft so that its engineering team gets enough time for essential software upgrades and all necessary certifications. Air India's Dreamliners fly at least 13 hours a day, while airlines such as ANA of Japan fly the aircraft for nine hours. "These are just procedural issues," says an Air India executive in the engineering department. "There is no safety issue."
For Boeing, Air India is important not just because it is a client. The state-run carrier is important also because it is a testament to Boeing's claim that these aircraft will help airlines make their long-haul routes profitable by cutting fuel costs. An Air India executive, who does not want to be named, says the Dreamliner is generating better cash margins because it is 30 per cent more fuel efficient than the Boeing 777. "That is why we are replacing the 777 one by one as this will cut down our operations cost," he says. "The only international route that is not profitable on the 787 is Australia but that is because it is a new route. Forward bookings are good here as well. We will be switching from the 777 to the 787 on the London route soon."
But not all in the beleaguered airline share the enthusiasm. Some executives question the entire induction process of the Dreamliner. A senior trainer at Air India, who does not want to be identified, says the problems are due to the lack of experience of pilots, lack of preparedness by the airline to induct the aircraft, and wrong decisions taken by Air India while deciding the configuration of the Dreamliner with Boeing.
Another Air India executive points to the incident where a fuselage portion fell off a plane. "The portion of the fuselage falls off because a rivet was not properly screwed or the rivet was not the right one or was not in its proper place or there was no correct equipment to put the rivet," he says. "The aircraft might be new but the attitude with which the person is working on the aircraft is still old."
The challenge for Air India is not only justifying the aircraft purchase and using it efficiently to turn profitable. Changing that old attitude is essential, too.
(Follow the author on Twitter: @manishasinghal)
