New Delhi [India], May 2 : Air India has cut flight schedules and warned of further reductions in the coming months as a "massive rise in jetfuel prices", along with airspace restrictions and longer flying routes, has made several international operations unviable, said sources citing a communication by its CEO Campbell Wilson.
Flagging the immediate challenge, sources said that Wilson had indicated that the Airline had reduced some flying for April and May due to the sharp spike in fuel costs, adding that these factors "has caused many of our international flights to become unprofitable to operate."
According to sources, the CEO further noted that the situation remains "extremely challenging," forcing the airline to take additional steps. "The airspace and jetfuel price situation remains extremely challenging, leaving us no choice but to further trim schedules for June and July," he said.
While domestic operations have also been impacted, the effect has been relatively lower. "The profitability of domestic flights has also been significantly affected, but to a lower degree thanks to the government's limitation of the domestic fuel price rise to 25%," Wilson said.
To offset rising costs, the airline has taken pricing measures, though with limited headroom. "We have increased airfares and imposed fuel surcharges but... these higher airfares impact customer demand, so we can only raise fares so far before people decide to stay home," he added.
The airline also expressed concern over the broader geopolitical situation, particularly in the Middle East, which has disrupted operations. Wilson said the company hopes "the Middle East situation settles - and the Strait of Hormuz opens - soon so that we can get back to a more normal state."
Amid near-term pressures, the airline said it continues to push ahead with its long-term transformation plans, including fleet upgrades and onboard service improvements.
On the network side, the airline has secured government approval to roll out hub-and-spoke operations. This will allow passengers from smaller cities to complete immigration and customs formalities at their origin airports. Wilson said this would enable "domestic passengers from Tier 2 and Tier 3 cities' to undergo immigration and customs clearance at their origin station and enjoy an easier transit experience in designated 'hubs', initially Delhi and Mumbai."
The airline also highlighted ongoing partnerships, expansion of international connectivity, and progress in training and customer experience initiatives as part of its broader transformation journey.