Date:15/12/2002 URL: http://www.thehindu.com/2002/12/15/stories/2002121504450800.htm

National

`AI poised to capture direct traffic to U.S.'

By Gargi Parsai

NEW DELHI DEC. 14. International air traffic estimates place Air India at an advantage over American carriers for capturing the non-stop, long haul market to the United States in the aftermath of the 9/11 events.

According to the Seattle-based Boeing's President (Aircraft Trading), Dinesh Keskar, the European and American carriers will take longer to recover from the effects of September 11. While traffic growth might revive by mid-2003, the U.S. airline profits were likely to bounce back to 2000 levels by late 2003-04.

He said the airline yields were 15 per cent lower in the U.S. and the long queues of passengers for security checks were affecting traffic.

"In this situation, Asia is the brightest spot, where things are positive with traffic being two per cent higher than 2000 and India is in that category.'' Air India was best poised to take advantage of the situation, as there were only two other airlines that operated non-stop to the U.S. from India.

As against the South-West, Asia's (including India) GDP growth rate would be the second highest at 4.90 per cent after China (5.90 per cent) between 2002-2021. In contrast, the GDP growth in North America is expected to be 2.70 per cent and in Europe at 2.30 per cent. India's travel demand would increase by 6.3 per cent per annum in the next 20 years.

During the period future airplane deliveries in India would be 290 of which three-fourth would be single-aisle planes costing $11 billion each in 20 years.

In India, Boeing comprises 65 per cent of Air India's fleet, 100 per cent each of Jet Airways, Air Sahara, Blue Dart and Alliance Air.

However, the domestic airline, Indian Airlines has no Boeing aircraft in its fleet.

Boeing is, however, still hopeful of winning a part of the Indian Airlines order for 43 aircraft which the domestic airline proposes to acquire from the European consortium, Airbus Industrie, in the next 10 years.

"We are concentrating on clinching the Air India deal for 17 aircraft but we are willing to work with Indian Airlines.

They are the ultimate authority. Should they decide to work with us, we are willing to work with them,'' said Dr. Keskar.

The Indian Airlines board has approved the purchase of 43 Airbus planes while the Air India board has given the nod for the acquisition of 17 aircraft for fleet augmentation and replacement.

The Air India proposal is still on, in that the airline is evaluating Boeing 777-200 ER (extended range) and Airbus A-340-300 for non-stop operations to Europe, the Far East, Africa, and Australia.

Both the Boeing Company and Airbus Industrie would have to compete for the order.

The Indian Airlines proposal is awaiting government approval and the Boeing Company is keeping its hopes alive for a review of the decision.

According to Dr. Keskar, while the B777-200 ER were good for Air India's non-stop services to long haul destinations, the B777-200 LR (long range) was designed to maximise airline revenue.

The B777-200s, with full flatbeds in the upper classes, will have the capacity to carry 270 passengers.