12. More importantly, what does this debt of Rs 52,000 crore do to Air India every year? See the Income statement : Look at the section in red. Rs 4500 crores of interest cost every year. EVERY YEAR!
13. Interest payment is more than the entire employee cost of Air India. Try making a profit with that kind of interest. So here is a “national interest”, which is not in national interest ! Now for those of you who argue that Air India is doing fine operationally, see the losses.
14. At 55,000 crores, losses are more than the interest payments. So, even if there was zero debt, AI would still be making losses. Have you seen a business run where expenses are 103 % of revenue? And all this when you own the planes !! CheckIndigo P&L & see how it manages below 85%
15. Air India expenses are 103% of revenue even before any interest payments. So they own the planes,no lease payments & still can’t run operations under budget. Beat that !!Want to compare how the debts look like for other airlines?
16. If Jet Airways can go down with the same aircraft strength but much lower debt, the Maharajah should have been dead long back but for tax payers grants.This debt is like a guillotine around the neck for Air India. It is not going away and the airline can’t make a profit anyways.
17. Employee strength & related costs: With 122 aircrafts, AI has 221 employees per plane compared to 127 per plane at Lufthansa (38,000 employees: 299 aircrafts) and 140 at Singapore Airlines (14,000 employees: 100 aircrafts).This is the worst employee per plane ratio in the world!
18. Not only overstaffed but at much higher wages. Air India's average employee cost in 2017 was Rs 21 lakh per annum. The average cabin attendants’ cost was even higher at Rs 24 lakh pa. IndiGo's average staff cost was Rs 14 lakh and average cabin attendant cost was just Rs 6.1 lakh
19. So an Air India Air Hostess gets paid 4 times compared to the Indigo crew. Wow! Now with that high staff costs, you would expect the services of a “Maharajah” on air India. No sir, it actually means that "the employees are the Maharajahs". AI runs for public service after all !!
20. Service levels: Is it really necessary to talk about it? Well if you insist, I’ll quote from the statesman article again as I have nothing more to add.
21. 2019: The brazenness continues. The airline, with total debt of around Rs 58,000 crore, sought the govt approval to borrow Rs 2,400 crore to meet its working capital. The ailing Maharajah has thus far already devoured over Rs 27,000 crore of the allocated amount by end 2018.
22. This is aside of the Rs 58,000 crore debt that is already looking difficult to recollect. Want to know who gave this debt in the first place? Look at the list of banks below. Do you see any private sector bank in the list ? It is all PSU banks with tax payers money again.
23. Still wondering why Govt run organizations always run in losses? Well, because nobody cares. Just like our DTC driver above as well as people right at the top who have distorted nationalism benchmarks. Until it is time to shut down. And the time is now.
24. Meanwhile there are small mercies that we should be thankful to. In view of the upcoming divestment, the Maharajah has put its “expansion plans” on hold. Thank Air India for this. Let this be their last favour to the nation!!