A-I may opt for Frankfurt and Munich as European hubs

Mumbai: State-owned Air India (AI) may opt for two airport hubs - at Frankfurt and Munich, in order to enhance its European and US-connect operations. Industry sources indicate that talks for slots and terminal positions between AI and German authorities are at an advanced stage and a decision may be taken sometime this week.

According to sources, AI may retain Frankfurt as its hub for European operations and also opt for Munich, which could serve it better once its network expansion plans come through. 
The Frankfurt hub will be utilised for its flights to the US originating from Mumbai and New Delhi, while passenger traffic from the US flying into Frankfurt will feed its afternoon flights back to India. AI currently operates daily services to Frankfurt. 
AI plans to shift operations to Munich when the load factor gets better. It is already running limited operations from Munich, connecting services to Los Angeles and Chicago. As Munich's expansion plans come into operation, the cost factor here would favour AI, as it could realise savings of 25-30 per cent over its operations from Frankfurt. 
There are some small glitches that remain to be ironed out before AI can opt for Munich, as it is being offered Terminal 1 instead of Terminal 2 here, which is where most of its Star Alliance members operate.
Frankfurt on the other hand offers better connectivity with Germany's rail-system and also offers considerable transit passenger population. Operating from Frankfurt frees AI from any undue reliance on other Star Alliance members for feed, sources say. 
On the flip side, Frankfurt is also the hub for German flag carrier Lufthansa, which is a founder member, and a dominant partner, of Star Alliance. Lufthansa may not appreciate having a competitor operate from its hub.