Tata group will build Air India as the mother brand of its airline business, which will have both full-service as well as low-cost carriers. In an interaction with Fortune India, chairman N Chandrasekaran says the group will keep the Air India as the flagship brand and that the airline is on its way to turn profitable.
The fleet size of the airline will be enhanced over a period of time, says the chairman. Air India recently signed agreements with Airbus SE and Boeing Co. for the purchase of around 540 jetliners. The deal is the largest bulk purchase in India's commercial aviation history. Airbus has got about 250 orders — 210 A320 single-aisle family models and 40 A350s wide-bodies. Boeing has secured orders for about 290 aircraft, which include 737 Max aircraft and 787 Dreamliners.
The group has already announced the integration of Vistara and AirAsia with Air India for which the legal process has started. "We will have both full services and low-cost carriers. Vistara is a full-service airline and has created a brand for itself. Though Air India is a full-services airline, it was not functioning well. Both Air India and Vistara are now well placed to compete with the best in the world. So we will benchmark ourselves to the best," says Chandrasekaran.
"We will have strong operating entities for maintaining aircraft and engines, customer service and loyalty programmes, which are being integrated with Tata Neu (SperApp)," he adds.
Tatas target to create a safe, respectable, world-class airline with the help of advanced technologies. "It will give graceful service for all passengers irrespective of the class they travel. So we really have a big aspiration for Air India. We will scale it up….. It is a big opportunity. We will expand internationally and also domestically," he added.
"We have a big plan for Air India, but it will take time. Just to get one issue fixed takes months. The machines were not looked after for a long time and systems are not there," he says. The 154-year-old group, which founded Air India during the time of JRD Tata, had acquired the debt-burdened airline for ₹18,000 crore in January 2022. Ten months later, in November, Air India announced that it acquired the entire stake of its joint venture partner Malaysia's AirAsia Group in AirAsia India (AAI) to integrate it with low-cost carrier Air India Express (AIXL). In the same month, Tata Sons announced the plan to merge Vistara, a 51:49 Joint Venture between Tata Sons and Singapore Airlines Ltd (SIA), with Air India.