State-owned Air India may decide to defer the deliveries of Boeing 787 Dreamliners.The airline board, which will meet for the first time after Rohit Nandan took over as the chairman and managing director, is likely to discuss it.
"The orders are not likely to be cancelled, but deferment of deliveries could be one of the possibilities that the airline may look into," said a senior civil aviation ministry official, who did not want to be identified.
Cancellation might not happen because the financing was to come from the US Exim Bank, he said, adding: "It (the financing) is cheaper and does not burden the airline much. The ministry only provides sovereign guarantee for the loans."
The board will also discuss the revision of the turnaround plan. A sub-committee of the finance ministry had asked the carrier to revise the turnaround plan. AI then decreased its fleet expansion plans from 245 to 240 and downgraded growth projections.
In December 2005, AI had ordered 111 aircraft worth Rs 46,000 crore (Rs 460 billion).
Out these, Air India has not received 27 Dreamliners, which has been delayed by over three years, and three Boeing 777s that it has deferred. AI, one of the launch customers of Dreamliner, is to receive its first two aircraft by the end of this calendar year.
The airline management, however, wants the delivery of the aircraft expedited.
The carrier does not have a strong fleet of medium-haul aircraft (seven to nine hours). Because of this, it operates many medium-haul international sectors with long-haul aircraft, like Boeing 777s,
that has made various such sectors commercially unviable.
Civil aviation minister Vayalar Ravi had recently said AI was under huge debt and did not have the money to buy any more aircraft.
Of AI's Rs 46,950 crore (Rs 469.5 billion) of debt, loans for aircraft buying are Rs 20,185 crore (Rs 201.85 billion), working capital loans Rs 22,165 crore (Rs 221.65 billion) and the others overdues.
The accumulated losses have crossed Rs 20,000 crore (Rs 200 billion), with the airline losing Rs 2,226 crore (Rs 22.26 billion) in 2007-08, Rs 7,189 crore (Rs 71.89 billion) in 2008-09, Rs 5,551 crore (Rs 55.51 billion) in 2009-10 and Rs 6,000 crore (Rs 60 billion) in 2010-11.
It is demanding an equity infusion of Rs 43,000 crore (Rs 430 billion) till 2021.
For this financial year, it wants an infusion of Rs 8,373 crore (Rs 83.73 billion), an up front equity infusion of Rs 6,600 crore (Rs 66 billion) and a support of Rs 1,772 crore (Rs 17.72 billion) in the form of a guarantee on short-term loans.
The airline's overdue amount is pegged at Rs 4,489 crore (Rs 44.89 billion). It includes Rs 2,600 crore (Rs 26 billion) to oil marketing companies, Rs 800 crore (Rs 8 billion) to airport operators and Rs 400 crore (Rs 4 billion) to other vendors.
