Air India executives deny shutdown rumors

Santhosh Varghese,

As the Indian government is preparing for a second attempt to sell heavy indebted national carrier, Air India’s top management is resolving to public communication to deny ongoing speculation that the airline might need to close down its operations.

On January 4, 2020, Air India chairman and managing director Ashwani Lohani took to social media to deny what it calls rumors of the airline’s possible shutdown. “Rumours reg[arding] air India shutting down or closing operations are all baseless. Air India would continue to fly and also expand and there should be no cause for concern whatsoever to travelers, corporates or agents. Air India the national carrier is still the biggest airline of India,” the message read.

Two days later, on January 6, the message was repeated by the company’s Commercial Director Meenakshi Mallik who called the rumors “baseless” and lacking an “iota of truth”. In a letter to the company’s travel partners, Mallik wrote that the airline’s financial and operational difficulties were being “appropriately” handled and it would continue service in both domestic and international markets.

In fact, the commercial director has even hinted at a possible expansion and new routes. “Air India will continue to explore new opportunities and expand its operations based on business opportunities available in global markets,” the letter reads.

The question of Air India’s capability to continue operations comes as its only shareholder, the country’s government, is preparing for its second attempt to disinvest from the ailing national carrier.  On January 7, 2020, the government approved a proposal to divest its 100% stake in the airline. It is now planning to issue the Expression of Interest document and invite preliminary bids by the end of January 2020, reports by local media indicate. Previously, in 2018, the Indian government tried to sell 76% of its shares in Air India, but the offer came to no avail as if failed to attract a single bidder.

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