AI's new COO to get Rs 1cr annually

NEW DELHI: Success is usually priceless but Air India’s new chief operating officer (COO) Gustav Baldauf will get richer by a crore annually if he manages the stupendously tough task of turning around the near-sick airline. AI is learnt to have decided a fixed-cum-variable pay package for its first ever expat COO where the total pay of over Rs 3 crore annually has been broken up into a fixed monthly salary of euro 29,000 (Rs 16.5 lakh) with a variable of euro 2 lakh. At Rs 57 to a euro, it works out to Rs 1.98 crore of fixed pay and Rs 1.14 crore of variable pay.

“The variable pay will be linked to achieving of certain pre-fixed targets. These targets are currently being decided by Baldauf and AI chairman Arvind Jadhav. Once they are set, the same will be reported to the board,” said sources. AI spokesperson did not comment on the chief operating officer’s pay package.

While the targets are expected to include things like fuel efficiency, streamlining of operations and computerising, sources said the variable component would help AI deal with the criticism of a cash-strapped airline hiring someone with a pay package in crores. AI chairmen, all senior IAS officers in recent past, have a maximum monthly pay of Rs 1.2-1.4 lakh per month while the COO — who will be reporting to the CMD — will get close to Rs 3.1 crore.

“Running an airline is a specialized job and given the precarious condition of AI, we wanted to hire a real airline specialist. Baldauf used to get close to euro 2.5 lakh when he was in Jet Airways as vice-president (flight operations) some years back when the euro was close to Rs 80. Now with the euro at Rs 57, the pay needed to be good enough for him to take up the tough challenge of turning around AI,” said sources.

The turnaround of AI is now being closely monitored by the Prime Minister’s Office and the Cabinet Secretariat. The decision to hire an international airline expert even at very high cost was also cleared at the highest levels of the government. Now Jadhav and Baldauf are working on a turnaround plan for AI, based on which the government will decide on the promised Rs 1200-crore equity into the airline after last fiscal’s infusion of Rs 800 crore.