Aviation

Air India shortlists 3 consultancies to chart business strategy

DELHI: Air India has shortlisted three consulting firms—McKinsey and Co., Bain and Co. and EY—for a project to draw up its business strategy for the coming years, said Ashwani Lohani, the state-run airline’s chairman and managing director.

The firms have been shortlisted out of several that made presentations after the airline floated a tender inviting proposals in October last year, reports Mint.

“They will help us in improving our network, cash flow and other things,” Lohani said.

The financial bids are yet to be opened, said another person with knowledge of the matter who did not wish to be named. The person said the contract will initially be for 3-6 months and may be followed by two more phases.

They will help look into product development, brand management, market share, competitiveness, frequent flier programme and the entire business model,” he said, “Basically tell us what we need to do urgently.”

This is the first time in a decade that Air India is hiring consultants for a major project. In 2006, consulting firm Accenture Plc was signed up at a cost of about Rs8 crore to execute a merger between the state-owned international and domestic airlines—Air India and Indian Airlines. Subsequently, the two were merged to create an entity called Air India.

Air India, which has the largest fleet of 140 planes in the country, including brand new Boeing Dreamliner planes, flies to 41 international cities and 72 domestic destinations. It is the biggest international carrier from India with a 17% market share. It also controls 14.6% of the domestic passenger market.

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