PanAm’s decision to reduce the published USA - BOM/DEL fare to $999 caused ripples in Air-India’s North American Headquarters in New York and the reaction was swift.  They issued a Press Release stating that the fare was illegal.  It so happened that a senior official of the Indian DGCA was attending an ICAO Conference in Montreal and he was persuaded to stop in New York on his way back where the AI R.D. was arranging a Press Conference with the objective of “officially” declaring that PanAm’s fare did not the approval of the Indian Government.

At this Press Conference, the DGCA representative stated that the Indian Government had not indicated its approval of the fare.  He did not, at any time during the Press Conference state that the Indian Government had disapproved it.  He then obliquely made reference to the possibility of a passenger traveling at this fare being subject to payment of a higher fare on disembarking at an Indian airport.  

In the meantime, I received calls from two prominent local Indian newspapers - India Abroad and News India of the impending Press Conference - asking for our (PanAm’s) views.  I also received a visit from a representative of a prominent Indian TV station.  The results of these calls and visit were as follows:

India Abroad asked me for a copy of the Bilateral Agreement between the USA and India, which we supplied.  They wrote an Editorial in the newspaper indicating that PanAm’s fare was legitimate and that passengers should have no fears of any retaliation on disembarkation.

News India stated that they would not cover the Press Conference if PanAm agreed to take a series of advertisements in their journal, which we rejected.  They did publicize details of the Conference. 

The TV Station decided not to attend the Press Conference.

There was some consternation among Indian travelers in the initial weeks following the Press Conference, but it subsided when they learnt that the Indian Government had not, in fact, taken any action against PanAm or its passengers.

Interestingly, I received a call from PanAm’s office in Bombay stating that Rajan Jetly, the M.D. of Air-India had expressed a desire to meet me on my impending visit to India.  Accordingly, I called on Mr. Jetley in his office and the first thing that I noted was that he had tried to change the the entire dark wooden panelling in his office by attempting to cover it with white paint, including his desk.  His so-called passion for this color, which had been also used on the outer walls of the Ashoka hotel during his tenure as the M.D. of ITDC, had now spread to the airline.  

I was saddened to see this attempt to desecrate such high quality furnishings, but refrained from making any comment.

Rajan Jetley tried to draw me into discussing the PanAm $999 fare but I told him point blank that I would be in violation of the anti-trust laws of the USA if I did so.  Nonetheless, he said that AI would be willing to go back to the pre-$150 cheque situation, if in turn, PanAm agreed to withdraw its fare.  

To show his bona fides, he asked Harish Malik, who had by then taken over as Commercial Director, to join our meeting.  At this meeting, he told Harish to instruct his R.D. in the USA that in case PanAm filed a new fare with the U.S. Department of Transport, to immediately make a similar filing matching the PanAm fare.  He should also, at the same time, stop offering the $150 cheques. Harish confirmed that he would issue such instructions immediately.

I made it very clear to both Rajan and Harish that I was not a party to any such decision/discussion as it would be a clear violation of the anti-trust laws.

On my return to New York, I informed the PanAm VP-Sales and Sr. Director - Atlantic of my meeting with Air-India.  I was told to do nothing.  However, PanAm did amend its filing raising the $999 fare to its previous level. AI did not match it; however, I received a call from one of Harish Malik’s lieutenants who told me to wait another few days.  I again made it clear that I was not going to be led into any discussion on the USA-India fares.

When, after another week, AI did not take any matching action, PanAm withdrew its filing.  By then, I had left PanAm and was now working full time with Air Mauritius and thus, was not privy to any further changes in the USA-India fare structure. However, the subject came up again after a few months when I received a frantic call from the AI Regional Director, which I will elaborate upon in a future Post.

After my meeting with Rajan Jetley in Bombay, I proceeded to Mauritius to attend the annual Sales Conference.  During one of the coffee breaks, the Chairman’s Secretary called me and stated that I should meet with Suresh Seegobin, the Commercial Director.

I met Suresh in his office and was pleasantly surprised when he stated “Inder, we have had a long honeymoon.  It’s time we got married”.  He said that the Chairman and he were very pleased with the revenue produced by North America and felt that it was time that we established a permanent footing in the region.  He asked me to present a proposal for consideration.

I told him that we should have a full time office in Toronto - a Sales Manager and a Reservations/Ticketing staff and that the New York office should be augmented by a full time Res/Tktg. staff.  He agreed and asked me to sit with the Accounts department and produce a Budget which I did.  He then offered me two choices for my remuneration:

1. A salary to be negotiated, plus rent allowance, plus a car; or
2. A similar salary (no rent allowance) and an incentive of 3% of net sales, plus a car.

I opted for #2 for two reasons.  Having worked for KU, we had lived in accommodation provided by the airline and upon leaving, had no roof over our heads.  I did not want a repetition and having now taken my own house, albeit on mortgage, I wanted the assurance that the house was our own, come what may.

Secondly, I was confident that we could generate much more revenue with two full fledged Sales offices and that the 3% incentive would in due time, more than offset the rent allowance.

I knew that I now had a real challenge on my hands considering that almost 95% of the Americans did not even know where Mauritius was. A “sea and sand” holiday was within 3 to 4 hours flying time away, in the Caribbean.  Mauritius meant two nights in an aircraft, but I felt that when sold in combination with other destinations, we “did have a shot”.  The budget that we agreed did give me optimism in achieving our targets and so, Manju and I left Mauritius for New York and I gave PanAm my two weeks notice of leaving them.

More on setting up the MK presence in USA and Canada in my future Posts.