The management of Air India is moving ahead with its transformational process which is not just confined to its image makeover but aims to establish the airline as a truly global carrier.
Streamlining operations
One year after acquiring Air India and embarking on a major transformational programme for the airline, Tata Sons said that the company aims to operate only with two airline brands, one as a full-service carrier and the other as a low-cost carrier. Presently, the group’s airline business besides Air India includes Vistara in the full-service airline domain and Air India Express and Air Asia India in the low-cost carrier space. The brands that will continue to operate in the future are Air India and Air India Express.
While speaking on the fate of Vistara, in which Singapore Airlines (SIA) owns a 49 per cent stake, Campbell Wilson, CEO and Managing Director, Air India said, “Vistara has been a successful airline primarily operating on domestic routes though in recent years it has expanded in international markets too. We are going to integrate the airline into the new Air India and the brand, Vistara will seize to exist. We will use the Vistara merger in Air India to accelerate our transformation programme as we intend to keep a lot of processes and practices of the former.” Wilson made the remarks while addressing reporters in New Delhi recently.
In November 2022, SIA and Tata agreed to merge Air India and Vistara, with SIA also investing US$250 million in Air India as part of the transaction. SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals. Air Asia India also became a fully owned subsidiary of Tata Group last November.
Not so long ago, as Air India marked the first anniversary of its return to the Tata Group Wilson while addressing the airline’s employees through a note said, “Together, we have embarked upon one of the most ambitious turnarounds in international aviation history. We have set out to create an airline that ranks amongst the best in the world, and will proudly represent the new India on the global stage.
“Even as we work on improving Air India, we have not shied away from other ambitious actions, such as merging Air India Express with Air Asia, or Vistara with Air India, or kicking off the establishment of a new InfoTech Centre, or an Aviation Academy. And that’s not to mention our much talked-about short- and-medium term fleet expansion.
“Taken together, the progress over the last 12 months has been nothing short of stunning, even if so, much of what we have been working on has been behind the scenes, building platforms and capabilities so that our future ambitions can take flight. There is of course much more that needs to be done, and everyone – internally and externally – is hungry for us to do it.”
“Transforming any organization entails deep cultural shifts, which is why we have put such a high priority on communicating with you, and on improving policies, practices and support systems, not just benefits. Fostering integrity, accountability, collaboration and trust are keys to future success and must be guiding lights. We will continue to communicate and roll out new things, being clear about the rising expectations we must all meet, how these relate to you and how we will support. Air India is on a journey to greater heights, and we want all of you to rise with it,” Wilson added.
Mega Aircraft Order
Last month, Air India announced a mega order to purchase 470 aircraft from Boeing and Airbus worth US$ 70 billion to support its growth plans. The carrier has signed letters of intent with Airbus and Boeing to acquire both widebody and single-aisle aircraft. The order comprises 40 Airbus A350s, 20 Boeing 787s and 10 Boeing 777-9s widebody aircraft, as well as 210 Airbus A320/321 Neos and 190 Boeing 737 MAX single-aisle aircraft. The A350 aircraft will be powered by Rolls-Royce engines, and the B777/787s by engines from GE Aerospace. All single-aisle aircraft will be powered by engines from CFM International.
Commenting on the occasion, Tata Sons and Air India Chairman, N Chandrasekaran said, “Air India is on a large transformation journey across safety, customer service, technology, engineering, network and human resources. Modern, efficient fleet is a fundamental component of this transformation. This order is an important step in realising Air India’s ambition, articulated in its Vihaan.AI transformation program, to offer a world-class proposition serving global travellers with an Indian heart. These new aircraft will modernise the Airline’s fleet and onboard product, and dramatically expand its global network. The growth enabled by this order will also provide unparalleled career opportunities for Indian aviation professionals and catalyse accelerated development of the Indian aviation ecosystem.”
The first of the new aircraft will enter service in late-2023, with the bulk to arrive from mid-2025 onwards. In the interim, Air India has already started taking delivery of 11 leased B777 and 25 A320 aircraft to accelerate its fleet and network expansion.
The acquisition of new aircraft, which will come with an entirely new cabin interior, complements Air India’s previously announced plan to refit its existing widebody B787 and B777 aircraft with new seats and inflight entertainment systems. The first of these refitted aircraft will enter service in mid-2024.
Addressing a virtual meeting with French President Emmanuel Macron on the agreement between Air India and Airbus, Prime Minister Narendra Modi said the Indian aviation sector will need more than 2,000 aircraft in the next 15 years.
As part of its transformation process for Air India, Tata Sons is also investing US$ 400 million dollar in completely refurbishing all seats and inflight entertainment of its existing aircraft. It expects to deploy the new-look aircraft on operational routes by the middle of next year.
Long Haul is the Key
Air India sees a major opportunity in serving long-haul markets through non-stop flights in European and North American flights. The airline recently resumed non-stop flights between Delhi and Vienna and Mumbai and New York. It has also relaunched non-stop flight service between Delhi and Copenhagen.
“Considering the size of India’s population, its diaspora of about 37 million people who are often among the wealthiest in their county of residence. There is an immense opportunity to operate point-to-point in long-haul markets. It is inconvenient to layover for 4-5 hours. So, Air India with our intention to fly from just not one hub but with multiple hubs in the country will be serving more people with a product they are wanting but are not getting,” added Wilson.
Recruitment Drive
Air India plans to hire over 4200 cabin crew trainees and 900 pilots in 2023 as the airline adds new aircraft and rapidly expands its domestic and international operations.
The cabin crew, who will be recruited from around the country, will undergo a 15-week programme imparting safety and service skills, and will be coached to exemplify the best of Indian hospitality and Tata group culture. The training program will include extensive classroom and in-flight training at the airline’s training facility in Mumbai as well as familiarization flights.
Notably, between May 2022-February 2023, Air India hired over 1900 cabin crew. Over 1,100 cabin crew have been trained in the last seven months (between July’22-January’23), and in the past three months, approximately 500 cabin crew have been released for flying by the airline.
Commenting on the hiring plans, Sandeep Verma, Head – Inflight Services said, “With a sizeable aircraft order that was announced earlier in the month, more flights on international and domestic networks, and re-alignment of domestic routes with AIX connect, cabin crew will play a decisive role in shaping the present and future of the Air India group. Addition of fresh talent will also accelerate the pace of cultural transformation at Air India, which is an integral part of our Vihaan.AI transformation program. We are also looking to step up hiring more pilots and maintenance engineers.”
The next two years are going to be critical for Air India’s ambitious plans. Years of mismanagement and strategic blunders had turned the once ‘inspiring’ airline into a mundane entity. However, Tata Sons have the business acumen to really ‘turn around’ the loss-making carrier. Can they succeed? Only time will tell.