Air India’s has stated that it will start making operating profit from this financial year thanks to a new operating plan. Although the airline has been running under losses since 2007, the strategy to monetize commercial assets, earning revenues from new joint ventures, such as for maintenance, repair and overhaul (MRO), leveraging the airline’s bilaterals in South-East Asia and West Asia, and a sharp drop in its wage bill by shifting staff to new joint ventures, will help return the airline to profit.
According to the plan, Air India will make an operating profit of Rs 449 crore in 2011-12 on operating revenues of Rs 16,525 crore. The operating revenues will increase to Rs 33,035 by 2014-15, when the airline is projected to make an operating profit of Rs 4,620 crore. The operating expenses in the same period will go up from Rs 16,076 in 2011-12 to Rs 28,415 in 2014-15.