Tata Group’s airline company Air India may cut the salaries of its employees and reduce the number of flights by about 20% to reduce its costs. Currently the airline operates around 900 flights every day. The company is preparing to take this step due to increase in operating costs due to cost of jet fuel due to the Middle East war. Let us tell you that the airline is already in loss and is looking for its new CEO. The company can also deduct the bonus of all employees. According to media reports, in the board meeting held on Thursday, Air India discussed sending non-technical employees on leave and cutting the salaries of officers at the level of Vice President or above. Apart from this, the bonuses of all employees may also be reduced. Air India is the second largest airline in India and these changes may be officially announced soon. 3 big reasons for increasing losses: The number of flights will be reduced by 20% for the next 3 months. According to sources, the board of Air India has proposed to cut flight operations in view of the situation arising due to the war in the Middle East. The airline may reduce its flight capacity by more than 20% for the next 90 days. This decision will remain in effect until the situation in the Middle East improves. Due to Iran war, crude oil became costlier by 45.5%. Due to the ongoing war between America and Iran, the prices of crude oil have increased by 45.5% since February 28. However, the government had capped the increase in ATF prices for domestic flights at 25%. Due to this, oil companies (OMCs) increased domestic ATF prices by only 9.2% in April, but this increase was much higher for international operations. Airlines’ fuel expenses increased from 40% to 60% According to FIA, the huge fuel price difference in the international and domestic sectors has made the airlines’ network financially unsustainable. Earlier, the share of fuel in the total operational expenses of airlines was 40%, which has increased to 60%. Leadership crisis and old wounds: This difficult time has come before Air India when the company does not have a permanent CEO. Tata Group has been searching for a new boss since the resignation of Campbell Wilson in April. Apart from this, last year’s tension with Pakistan and maintenance expenses of old aircraft have also broken the back of the company.
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Air India will cut the salary of VP level officers: Preparation to cancel 20% of flights due to Iran war, company will send non-technical staff on leave
