Airlines must look at common services facility to cut costs: Suresh Prabhu

As Indian airlines seek to expand their fleet, former Union Civil Aviation Minister Suresh Prabhu has said the carriers should look at having a common services facility within the country for maintenance, repair and overhaul works as that will help reduce costs.

With Air India placing orders for new aircraft after more than 17 years, he also said the airline should look at flying more on the profitable Gulf routes as well as restoring overseas "historical connections" which it used to operate earlier.

Prabhu served as the Civil Aviation Minister from March 2018 to May 2019 and during his tenure also efforts were made to turnaround the loss-making Air India, which was finally taken over by the Tata Group in January 2022 under the government's disinvestment programme.

 

"We should work on having international aviation hubs in India as well as look at having some sort of a common aviation services facility that can be shared by all airlines. Such a facility will help in reducing costs as most of the aircraft in India goes overseas for MRO (Maintenance, Repair and Overhaul) works," he told PTI.

While noting that aviation is a challenging industry, BJP member Prabhu, who has also helmed various other Union ministries in the past, said that Air India should be operating at full scale and not at a sub-optimal level.

Earlier this week, Air India announced placing firm orders for 470 planes from Airbus and Boeing, and there is also the option to acquire another 370 aircraft.

"Ordering aircraft was a necessity for Air India... After the demise of Jet Airways, there has been a vacuum which is being filled partly by Vistara. With Air India's acquisition of a large number of aircraft, the vacuum can be filled to a large extent," he said, adding that bringing air connectivity to more Indian cities will also have a huge impact on Air India's profitability.

Jet Airways shuttered operations in April 2019 due to financial woes.

India is the world's third largest aviation market and domestic carriers are expanding their fleet as well as operations to cater to the rising air traffic demand.

"With induction of new aircraft, Air India should also look at targeting the routes between India and Gulf countries where there is always a huge demand. The Gulf sector is also profitable.

"In that segment, India always has the issue of reciprocity. Many Gulf carriers want to operate more flights to India but Indian carriers do not have enough capacity. As a result, fares on the Gulf routes have reached astronomical levels," he added.

According to him, with new aircraft, Air India should operate more flights in the Gulf sector and other routes which the airline used to fly earlier such as Cairo.

"We still have reciprocal rights (with various countries)... Air India should look at restoring historical connections," Prabhu said.

For instance, Prabhu said there are a lot of Indian-origin people in East Africa but there is hardly any connectivity by Indian carriers and Air India should strategise properly for such routes.

Besides, he said efforts should be made to have aircraft leasing and financing activities in India.