Air India, the flag carrier operated by National Aviation Co. of India Ltd, will replace several of its West Asian flights that offer business class travel with all-economy flights of its discount carrier in an attempt to reduce costs and increase revenue. Business class travel has been declining globally amid an economic slowdown, according to numbers released by the International Air Transport Association. Global travel on premium tickets declined 23.8% in May from a year earlier, economy travel was down 7.6% in the same month. "There is hardly any business class required in West Asia," said an Air India official.
The carrier’s low-cost affiliate, Air India Express, operates 186 flights a week between India and West Asia and South East Asia. The airline will increase its services to West Asia to make up for the flights Air India plans to pull, said a government official. Air India has committed to undertake an overhaul of its business operations, restructure its massive Rs.15,241 crore debt, raise funds through a public offering in fiscal 2011 and convert three out of four of its flights into low-fare services.
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