With the last date for submitting the bids for the lease getting over recently, Sigma, a leading aircraft operator in Asia, has also joined the race. Sigma will now compete with Singapore Airlines for leasing out two 747-300s. Airbus Industrie will be the sole bidder for six A-310s.The proposed fleet expansion will enable the airline to sell at least four of its old 747-200 aircraft. The AI board has approved the dry-lease plan in February.

The lease will be for a period of two years and the airline will have to pay monthly charges. A Mumbai-based analyst said that the aircraft lease will be cheaper in the long run since the airline will have to make an upfront payment of 15 per cent of the total cost. However, from a long-term point of view, the lease may be an expensive proposition.

AI has, of late, been initiating various cost-cutting measures to stem the ballooning expenses. The recent one is the plan to replace its general sales agents (GSAs) with consolidators. This has been done due to a directive from the parliamentary commitee on public undertaking asking the airline to review its policy on appointment of GSAs.

The move would result in a saving of 3 per cent overriding commission currently payable to GSAs which is not applicable in the case of consolidators who do bulk bookings.The exercise will be done in stages after doing a cost benefit analysis and the present GSAs will also be eligible for consideration. In an attempt to minimise the role of travel agents, the airline has been striking direct deals with corporates. Travel industry source said that this could be part of the airline's effort to gear up for a scenario where commission chares will cease to exist.