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Air India Not to Ground Snag-Hit B787s – by Jay Menon

: Mar 14, 2014 - : 10:03 pm

 
Despite the frequent technical snags, Air India has no plans to ground its Boeing 787 fleet, but may claim compensation from the air-framer for the financial losses suffered by the national carrier due to these glitches.
 
On a day when Boeing delivered its 13th 787 aircraft, Air India chairman and managing director Rohit Nandan says, “We have no such plans as of today to ground the 787s. It is for the regulators to take a view on the matter but we are quite satisfied with the quality of service we have received from this airplane and its economics.” 
 
Official data indicates that since its induction two years ago till February, Air India’s 787s have experienced about 45 major engineering snags. A total of about 140  “minor” technical problems had occurred in the fleet since its delivery began in September 2012.
 
"The incidents which we experienced in nearly one and half years are not unusual in a new fleet. Everybody is trying to adjust to new machines introduced in our fleet. Both Boeing as well as DGCA have looked into every incident and assured that no safety aspects were involved in any of the incidents. To that extent, we are reassured,” he says at the India Aviation 2014, in southern Indian city of Hyderabad.
 
 "Air India had discussions with the Boeing team and our engineers are in touch with them," he says.
 
Boeing at the moment is upgrading software of the airplanes that Air India has received till December. "Since then, most of the fleet has been upgraded and the number of incidents are gradually coming down,” the Air India chief says.
 
Referring to the fuel efficiency of the aircraft, Nandan says when they received the first aircraft, they realised the machines were heavier than originally promised.
 
A committee comprising officials from the government, the airline and Boeing was constituted. The carrier is collecting 18 months of data up to November to gauge if the airplane is consuming more fuel than originally anticipated.
 
"That committee is working and the 18 months will be over in November. We shall decide the compensation package after that," says Nandan, without giving any details. He also says that Air India has already received compensation from Boeing for the delay in delivering the 787s.
 
Dinesh Keskar, senior vice president of Asia Pacific and India Sales, Boeing Commercial Airplanes, says the 787s were an important aspect of Air India's turnaround plan.
 
"Air India flies over 700 flights a month. You hear about one or two of them  but don't hear about 698," he says.
 
"Air India losses are getting smaller and we hope that by the time they get all these airplanes, they will be making profits and that will be our contribution to India's civil and most prominent and oldest airline," he adds.
 
In January 2013  there was an incident overseas relating to the batteries installed on a Boeing 787 aircraft, which necessitated the grounding of the aircraft fleet worldwide in accordance with the directive issued by FAA of US.
 
Due to the grounding of the 787s in 2013, Air India had incurred additional direct or indirect expenditure of  6 million rupees per day, due to substitution of other aircraft on its route and an extra cost of  14.3 million rupees per day, for aircraft financing and pilot maintenance.
 
The national carrier, which had placed orders for 27 Dreamliners in 2006, has so far taken the delivery of 13 aircraft. It is scheduled to induct another 14 787s over the next two years. 
 
Air India recently decided to sell and leaseback seven Boeing 787 aircraft in addition to the seven already sold and leased back earlier this year.
 
The airline will sell the seven 787 aircraft to the “relevant lessor and immediately lease the same back under an operating lease for a period of 12 years with an option to extend.” 
 
“The company will pay all the loans outstanding against these aircraft, which will reduce the interest and loan liability by $60 million a year besides $40 million by savings a year by way of maintenance costs.The move will also discharge the government guarantee given on these loans,” a senior airline official says.

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