I just came across a newspaper article which stated that Air-India is looking for a loan of Rs. 1,100 crores to modify planes for use by VVIPs. How come the Government is not paying for these modifications; after all, the benefits are for its top politicians - the President, Vice President and the Prime Minister. Why does AI have to add to its massive debt to cater for the comfort of such people?
Getting back to my early years with Air Mauritius (MK), I asked MK’s Head Office if they had Area of Sales statistics which would give me a starting point and thereby direct my limited resources to improving their North American revenues. Unfortunately, they did not have such figures; it appeared that the bulk of their traffic comprised of foreign tourists and ethnic Mauritians residing overseas.
I was told that the Mauritius Tourism Department did, however, have an office in New York and perhaps, I should make contact with their representative. I did that but found little satisfaction. The person running this office also represented other Tourist Organizations and Mauritius was only a small part of his portfolio.
I then went to Washington, DC and called upon the Embassy and the Ambassador. The Ambassador was very happy to meet me and delighted that MK was planning to open an office in the USA. I learnt that there was a small number of Mauritians working for the World Bank and the IMF in Washington and apart from this possible source of traffic, there were a few Mauritian nationals spread all over the country. The Embassy promised to advise all such persons of my location and contact.
I called on the travel offices of both the World Bank and the IMF and was able to get some names and addresses. They also told me that most of the Mauritians traveled in Business class which was paid for by the World Bank and IMF. I spoke with a few Mauritians in these organizations and learnt that they did travel to Mauritius on their holidays but used British Airways as they got upgraded to First Class, because of the airline’s Frequent Flyer program.
An approach to MK’s Commercial Director was successful and I received authority to upgrade these passengers to First Class on MK flights, if I was successful in getting them to switch airlines. This became an excellent source of revenue because it was high-yield.
Canada proved a valuable mine - there was a significant (by Mauritian standards) Mauritian ethnic population in eastern Canada primarily because of the language issue - Mauritians are fluent in both English and French. I made contact with a couple of ethnic agents in both Montreal and Toronto and was able to generate some business, even though it was low yield and I had to offer incentives in the form of Consolidator fares, which I was happy to get from Mauritius.
The net result was that before the end of my first year with MK, we managed to increase our Area of Sale revenues to such an extent, that H.O. approved my request for a full time staff who would be able to answer telephone calls and make reservations.
Until I recruited a suitable person, I was calling MK’s office in London for reservations and manually issuing tickets from my residence. I did not have a stamping machine and had to sign my name in the validation box. I had picked up a stock of 2 and 4 coupon tickets on my initial visit to Mauritius and hand wrote all tickets. My membership of IATA’s Traffic Handling & Accountancy Working Group in the 1960s came in very handy; after all, the Group had designed the passenger tickets, Exchange Orders and MCOs.
However, I had absolutely no experience in making reservations and I did not have a terminal. The addition of a full time staff was a great boon. I rented a room at a hotel in Manhattan close to the PanAm office and installed this staff and a terminal. I also took lessons in making reservations.
And here, I come to my association with Pan American World Airways, which had always labeled itself as the World’s Most Experienced Airline.
I had joined MK on a part time basis effective July 1,1986. I had a lot of time on my hands and also a need for more income and was overjoyed when I received a call from my old friend James Montgomery.
Jim had retired as Executive Vice President - Marketing & Sales of Pan American World Airways and they had rehired him as Executive Assistant to the Chairman and CEO of PanAm. I had known Jim during my Air-India days and maintained contact with him while I was with Kuwait Airways. Additionally, he was one of the PanAm officials whom I had met with the Hindujas when they were trying to become the airline’s GSA in the USA.
Jim said that PanAm was looking for a part time Consultant for the Indian market and asked if I would be interested. PanAm had two other Consultants for the Israeli and Irish markets and wanted one for the Indian market. I happily accepted the offer and met their V.P. Sales and their Senior Director - Atlantic who wanted me to start effective November 1, 1986 and after getting a clearance from MK’s Head Office, I accepted the part time assignment with Pan Am.
I now had two part time assignments and this helped considerably in reducing my digging into my dwindling finances to make ends meet.
I was assigned a cubicle in the PanAm’s offices above Grand Central Terminal and once I received approval from MK to hire a full time staff, they also gave me funds to rent an office. Hence, I rented a room at the Roosevelt Hotel across from Grand Central Terminal and was able to work out of both locations.
I was finally working full time and devoting about 66.6% of my time to PanAm and 33.3% to MK.
I traveled to the west coast, the mid-west and to various cities on the eastern seaboard trying to understand how PanAm was conducting its business and generating traffic to India and found a very interesting lacuna in their Distribution Policy. The airline’s Sales reps did not visit any agent who gave PanAm less than $1 million in revenue in all market segments. Hence, the bulk of their traffic came from 4 or 5 large Indian ethnic agents.
I recommended changing this policy in respect of the India market and they agreed to appoint a number of agents who specialized in the Gujarat and Kerala markets throughout the USA. I also suggested changing their schedules to provide better connections to interior U.S. cities.
While I was involved in these changes, Air-India came up with a harebrained scheme of issuing checks of $150 to each passenger who traveled on their services to India. Not only were they discounting their published fares by up to 30%, they now reduced their net yield by another $150 per passenger.
We held a very short meeting at PanAm’s Head Office where they accepted my recommendation that we do not match this practice of Air-India, but instead, reduce the published fare to $999, which was equal to the net yield that AI was earning. The advantage of this would be that for the first time, the passenger finally knew what he was being charged instead of what his ticket showed.
A second and major effect of this change would be that the fare was applicable from all interior and west coast points served by PanAm; something that AI could not match without further diluting their net yield. Additionally, it was available to all ARC and IATA agents throughout the USA, instead of only agents specializing in the Indian market. We saw immediate results - we saw, for the first time, passengers originating in places like Las Vegas, Birmingham and Wichita who had never before traveled on PanAm.
The results of all the changes that I had recommended were fast in coming and at the end of the first year, PanAm wrote me a very appreciative letter in which they said:
“We continue to put a very high priority to your project and are extremely pleased with the 46% increase in traffic from the USA to India in the past year”.
An increase of 46%!!! Coming from the so-called “World’s most experienced airline” , it was quite a compliment.
They not only renewed my Contract but also stated in the same letter “You have our continued support and cooperation in your new efforts to help improve the India originating traffic”.
So, I started the 2nd year of working with PanAm to increasing traffic out of India which I will comment upon in my next Post.