Tata Group Mulls Over Merging AirAsia India and Air India Express

While Tata Group is all set to take over the operations of Air India by January 23, 2022, the group plans to merge low-fare airline AirAsia India with Air India Express. With the merger, Tata Group intends to create a single airline entity. Economic Times reported that Tata Group might operate AirAsia India on domestic skies and use the airline to extend Air India Express’ international network. Air India Express operates Boeing 737s, and AirAsia India operates a fleet of Airbus 320s. While Tata Group will launch both Air India Express and AirAsia India under the same branding umbrella, food menu and other services, Air India Express is likely to follow AirAsia’s reservation system.

100-day plan to improve Air India services

Tata Group is preparing a blueprint of a 100-day plan to improve the basic services of Air India. The group will improve its on-time performance, solve passenger complaints and call centre issues. According to the data released by the aviation regulatory authority Directorate General of Civil Aviation in October, Air India was the third-largest in terms of passenger complaints. The government is making efforts to hand over Air India operations to Tata Group by the end of December. Tata Group originally launched Air India in 1932 and submitted Rs 18,000 crore of the bid to acquire its airline from the government. According to the deal, Tata will retain Rs 15,300 crore of Air India’s debt and pay Rs 2700 crore to the government as cash. The debts not absorbed by Tata Sons will be taken care of by the government. Air India reportedly has Rs 61,650 crore of debt as of August 31, 2021. According to DNA, Tata Sons is likely to choose aviation trade veteran Fred Reid as the Chief Executive Officer (CEO) of Air India. Reid has over 35 years of expertise in the aviation sector. Air India has 117 wide-body and narrow-body aircraft, and Air India Express has 24 narrow-body aircraft. Tata Group operates Vistara in partnership with Singapore Airlines. Air India will have to face competition from IndiGo in the domestic market, Singapore Airlines, Emirates and Etihad in the international routes.