On AI revamp menu: Non-stop daily flights to Toronto,Chicago

Air India may introduce a brand new product in the market by launching non-stop daily flights from New Delhi to Toronto and Chicago.

In an attempt to re-invent itself,national carrier Air India may introduce a brand new product in the market by launching non-stop daily flights from New Delhi to Toronto and Chicago. The move is part of the overall restructuring process at Air India that includes route rationalisation.

The loss-making airline would be aiming at launching these routes in the coming winter schedule,added a source. The airline is working on setting up its hub at the newly opened Terminal 3 at the Delhi airport. Once that is finalised,it would start these two routes, the source added. The airline hopes to fetch 40 per cent load factors on these flights in the first year of its operations and hopes to break-even on these routes in the third year of its launch.

The airline currently operates daily scissor operations to Toronto via its hub in Frankfurt from New Delhi,Mumbai and Ahmedabad. On this sector,its operating costs come under immense stress as Frankfurt airport has proved to be much costlier. The airline would also be looking at shifting its European hub to another location. It could be Copenhagen,Dublin or Birmingham which are much cheaper than the Frankfurt airport,source added.

The airline receives a stiff competition from Jet Airways on this sector which operates scissor operations from Mumbai,Delhi and Chennai to Toronto via their European hub at Brussels. Jet Airways has done pretty well on this route and would be a major threat to Air Indias expansion plans on this sector, said Kapil Kaul,CEO,Centre for Asia Pacific Aviation.

In addition,the airline is likely to club its prestigious two non-stop flights to New York from New Delhi and Mumbai. It will be made into a single product offering,from New Delhi to New York. A feeder flight from Mumbai would be deployed to carry the passengers to New Delhi for onward non-stop journey to New York, said the source. These two non-stop routes have seen Rs 400 crore annual losses. While the Delhi-NewYork-New Delhi flight maintained load factors above 70 per cent,Mumbai-NewYork-Mumbai has reported poor load factors.

The airline has suffered losses on almost 90 per cent of the international routes,which has added to its current woes.