National carrier Air India (AI) plans to spin off maintenance, repair and overhaul (MRO) engineering operations by April to earn about Rs 3,000 crore annually through the engineering division.
The airline has formed an alliance with Aerostar Asset Management for marketing its engine overhaul facility to sell repair services for Boeing and Airbus jet engines. Boeing is investing Rs 464 crore, while Air India will provide manpower, land and hangars at the MRO unit, which will be set up at Nagpur.
The airline aims to garner around Rs 100-150 crore annually from the cargo business post spin off. The government has agreed to give Rs 800 crore to the airline, only if it continues to cut costs. AI expects a net benefit of Rs 563 crore in terms of cost reduction for 2009-10, because of network restructuring, and route aircraft deployment rationalisation.
Contact: Air India Tel: +91 11 2462 2220 Web: www.airindia.in