AI to hire 700 to meet its shortage of cabin crew

In one of its largest hiring programmes since the Indian Airlines-Air India merger, the airline is increasing cabin crew by 700 to tide over the current shortage. New hires will be a mix of trainees and experienced staff.

"The need to hire emerged after we saw a shortage of crew. We will also need a lot of people for our expansion plans, with Delhi airport becoming our hub," said an Air India official, who did not wish to be identified.

Air India has 3,200 cabin crew and a negligible attrition rate.

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The national carrier is planning to expand domestic operations by connecting small towns using smaller aircraft and might even revive the defunct Vayudhoot.

The airline also proposes to connect 50 locations across the country and increase domestic and international services. All these plans call for a larger cabin crew strength.

At the same time, Air India Express, the low-cost wing of the airline, is planning to induct four more aircraft and will require 74 new cabin crew members. This addition will help increase the number of flights from 168 to over 200.

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But with overall demand for cabin crew growing thanks to expansion by competing domestic airlines, analysts say it is important that AI keeps some elbow room should attrition rise. Other major airlines are already seeing cabin crew leave.

"Cabin crew training in India is among the best in the world. Many international carriers, especially West Asian, hire cabin crew at a hefty pay, leading to a shortage," said an executive with a full-service carrier.

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Vijay Mallya-owned Kingfisher Airlines and Naresh Goyal-owned Jet Airways have seen 500 cabin crew members leave in the past year.

Kingfisher has 1,500 cabin crew members and Jet has over 2,500. Both airlines have hired over 150 cabin crew each in the last one year.

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Air India has asked for another equity infusion of Rs 2,000 crore (Rs 20 billion) from the government to improve its financial condition and debt-equity ratio.

The government injected Rs 1,200-crore (Rs 12 billion) recently and Rs 800 crore (Rs 8 billion) in 2009-10, taking the equity base to Rs 2,145 crore (Rs 21.45 billion).

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AI's annual interest payment is around Rs 1,800 crore (Rs 18 billion) on debt of Rs 40,000 crore (Rs 19,000 crore is high-cost working capital debt) and has accumulated losses of Rs 15,000 crore (Rs 150 billion). The carrier lost Rs 5,551 crore (Rs 55.51 billion) in 2009-10.

The carrier wants to freeze pay hikes and promotions for its 31,000 employees over the next three years. It has an annual wage bill of Rs 3,100 crore (Rs 31 billion) and will see as many as 2,600 employees retire by 2014.