Air India's 6th Boeing 787 Dreamliner seen on the factory floor in Everett, WA. Photo by Jeremy Dwyer-Lindgren.
Things for Air India aren’t exactly going so great right now. The airline is in the middle of a pilot strike that has been going on since May 8th and has cost the airline over $63million, due mostly to international flight cancellations. Over 200 pilots have called in sick and the airline has responded by firing over 100 of them.
Back in 2005, Air India placed orders for 27 Boeing 787s and was originally supposed to take delivery starting in September 2008. Obviously that did not happen with the delays of the Dreamliner.
It was expected that the airline would take delivery of their first Dreamliner by the end of May 2012, but almost un-noticed, no aircraft have been delivered.
According to MyDigitalfc.com, “Air India was earlier supposed to receive the first Boeing 787 Dreamliner aircraft by this month-end, but the delivery was delayed due to technical issues revolving around last minute checks relating to minor glitches in interiors.” It seems like it might be more complicated than that.
It appears that Air India is trying to receive compensation for the delays of their aircraft and are refusing to take delivery until an amount is agreed upon. If this sounds familiar, it is because Cargolux pulled something similar with Boeing before taking delivery of their 747-8Fs.
One of the concerns raised by the striking pilots is that many who are being re-trained to fly the 787 are from the ex Indian Airlines (which was merged with Air India in 2011). According to The Hindu Business Line, it would cost about three times as much to train ex Indian Airlines pilots to fly the 787 versus Air India pilots, so it doesn’t quite make sense.
Earlier today, the Wall Street Journal reported that the Indian government is planning to invest 12 billion rupees ($215.6 million) into the faltering airline. For now, it seems Air India will stay afloat, even though it has lost large amounts of money over the past five years.
So, will Air India ever take delivery of their 787 Dreamliners and why are they delayed? Emails to Air India have gone un-answered and at the time of posting this story, Boeing is working to answer some questions posed by AirlineReporter.com.
Boeing has billions of dollars worth of aircraft currently sitting at Paine Field, which I am sure they just want to deliver to their customers. It seems like odd timing that Air India, which doesn’t really have any pilots to fly the 787 right now (or money), is aggressively seeking cash from Boeing, just days before intended delivery.
Boeing has written back and explained, “We look forward to delivering the first 787 Dreamliner to Air India, but we don’t discuss details of our delivery plans and defer to our customers to announce their own timing.” When asked if there were any technical issues that contributed to the most recent delay and if the 787s are currently ready for delivery, Boeing stated, “We don’t discuss those topics.” This is not too surprising, since Boeing is still in the middle of negotiations with Air India.
The NYDailyNews is reporting that a compensation package offered by Boeing has been accepted by the Air India board and now needs to be approved by the the Cabinet Committee on Economic Affairs (CCEA). The CCEA is planning to meet with Boeing tomorrow, Thursday.
According to the Wall Street Journal, Air India is expecting to receive their first 787 Dreamliner later this month.
Jet Aiways Boeing 777-300 Taking off
Jet Airways, which is based in Mumbai, India and serves over 400 flights and 65 destinations, has cancelled more than 250 flights due to a standoff between pilots and the airline’s management. 432 of the 760 pilots with the airline are protesting four of their colleagues being fired. Reuters is reporting that the four pilots were sacked for trying to start a pilot’s union, the National Aviators’ Guild (NAG). However, the airlines says they were fired for “indiscipline.”
The pilots are demanding that the four pilots be re-hired before they stop protesting and the airline is demanding the dismantling of the NAG. The airline has scheduled talks for Friday in an attempt to end the stand-off. Hopefully the issue can be resolved shortly, since the continuing strike and bad press will continue to plague the airline.
Hawaiian Airlines Boeing 767-300 (N589HA) at Kahului Airport on Maui
The Air Line Pilots Association (ALPA), which represents the pilots of Hawaiian Airlines, started “informational picketing” today at the interisland terminal of the Honolulu International Airport. Earlier in the month the ALPA opened up a “strategic preparedness center,” near the airport to help coordinate phones and picketing, if no deal can be reached with the airline. This follows two years of unsuccessful talks between the two sides, that seems it might lead to the pilot’s going on strike.
The ALPA stated, “while progress was made, Hawaiian management still insists that any salary increases over 1%, or other contract gains, be paid for by pilots making offsetting concessions elsewhere in the contract. Based on the airline’s outstanding financial performance and the record bonuses management received last year, this lack of substantial movement has forced the pilots to call for a strike authorization vote.”
They have a valid point with profit changes. The current contract was negotiated in 2005 before Hawaiian emerged from bankruptcy and now the airline is making a profit. However, the airline business has volatile ups and downs. One quarter an airline can be in the black, making profit, the next, deep in the red and talking about bankruptcy. If an airline is going to protect itself for the bad times, then yes, it means there will be surplus in the good times.
The ALPA is seeking a 17% salary increase over four years, plus a 2.5% addition to the pension plan for pilots less than 50 years of age. The ALPA states the airline is offering only a 1% increase each year for four years, with possible additional increases in exchange for concessions in other areas.
Hawaiian Airlines’ CEO, Mark Dunkerley, states that the union is “mischaracterizing” the airlines offer and that a strike is not “imminent.” Dunkerley points out that the airline has offered its pilots a 20% increase over six years with profit sharing, for the ability to modify their bidding rules for new routes, allowing the airline to become more competitive.
The back and forth bickering sounds like a typical contract standstill. There are still quite a few steps before the pilots could strike. The union members need to authorize a strike and the government would also need to give the go ahead. Sadly, the people that lose out the most are the passengers, especially those that might be looking for a nice, much needed vacation to Hawaii.
That's a green Boeing
The on-going strike at Boeing is surely having an adverse affect on its commercial airline divison.
Boeing went from delivering 36 planes per month during August and July down to 12 in September and only 5 in October.
The end is in sight, since the 27,000 striking workers approved a new four-year contract this last Saturday.
This, of course will cause another set back for the already much delayed Boeing 787. This coupled with the hurting economy will most likely have a negative impact on airlines as well.
Source: KOMONews Image: Individuo