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Air India to take cost-cutting steps fueled by global COVID-19 crisis

Air India to take cost-cutting steps fueled by global COVID-19 crisis

Air India, the Indian airline company announced plans to undertake a number cost-cutting measures, keeping in view the dwindling financial position of airline amid COVID-19 crisis and its effects on the aviation industry.

As countries are closing down borders to international travelers and people are canceling travel plans due to the Covid-19 pandemic, the airline is trying to contain costs to ensure it remains afloat. Apparently, airlines all over the world are taking steps in this regard.

Starting April 1st, allowances of the cabin crew will be reduced, executive entertainment allowance of executive pilots will be fully withdrawn.

SK Singh, executive director for finance in Air India said in a letter to employees that the national carrier of India has reduced layover and subsistence allowances of cabin crew and has completely withdrawn executive entertainment allowance of executive pilots. In addition, fuel reimbursement of all officers has also been cut by 10%.

As the global coronavirus pandemic has led to massive flight cancellations, GoAir had also asked its employees to go on rotational leave without pay.

SK Singh also informed in the letter to Air India employees that keeping in view the financial position of the airline in the wake of the recent global happenings, a significant need has arisen to take steps to cut down costs as far as possible. Airlines all across the world are taking vigorous steps and a few of them are have already taken very aggressive actions, he added.

As per sources close to the matter, the estimated cost savings expected from these decisions taken by the airline are not yet confirmed. After the national capital has put a ban on people from the U.K to enter India till the end of March, Air India has also cancelled many international flights to Europe, including the United Kingdom.


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Nandita Bhardwaj

Nandita holds a management degree with specialization in marketing, and boasts of a short-term experience in the field of recruitment. Following her passion for writing however, she decided to pursue a career in the field of content development. Presently, Nandita pens down news pieces for, spanning the verticals of business, finance, and technology.