Tata Group progresses with airline merger plans

An Air India Airbus A320 lines up for takeoff.
Md Shaifuzzaman Ayon, CC BY-SA 4.0, via Wikimedia Commons

The Tata Group plans to merge Air India and Vistara into one full-service carrier continue to move ahead, with recent approvals by the Competition Commission of India, and the continuation of Air India’s fleet upgrade and aircrew expansion.

CCI approval of Tata Group merger plan

In some relief to the Tata Group, the merger request of Air India and Vistara was approved by Competition Commission of India (CCI) on 1st September,2023.

This comes right after a few months when CCI had issued a show notice to the airline demanding an explanation as to why the proposed merger of Air India and Vistara should not be investigated over the concerns about the competition in aviation industry.

With this major hurdle now cleared Air India seems to be one step ahead towards its consolidation of the airline business. The CCI has approved the merger with certain conditions in place.

Building the full-service carrier

Once this merger goes through Air India has the potential to become India’s largest international carrier and second largest in domestic sector, with the largest domestic carrier being IndiGo.

Vistara and Air India are currently the only full-service carriers remaining in the country, with this merger India will have only one full-service carrier.

Vistara is a joint venture with Tata’s and Singapore International Airways (SIA), wherein Tata owned 51% stake whereas SIA owned the rest 49%.

A Vistara Boeing 787-9 Dreamliner in flight
Anna Zvereva, CC BY-SA 2.0, via Wikimedia Commons

With the new merger in place, SIA has agreed to infuse Rs. 2059 crore into the airline and will own 25.1% stake in Air India.

This new investment will increase the presence of SIA in Indian aviation market which is one of the fastest growing aviation markets in the world. This investment in Air India will be much larger than SIA’s previous investment in Vistara.

Air India fleet and aircrew expansion

Air India is currently on its track to completely revamp its overall product and with the recent launch of new logo, Air India has shown how serous it is about a complete overhaul to enhance customer experience and become a well renowned international airline.

Amidst all this news, in the first week of September Air India has added two Boeing 777 aircraft in its fleet to enhance its service to the US. Air India had last year planned to lease 11 Boeing 777 aircraft out of which five are B777 – 200 LR and six B777- 300ER.

The airline has also announced that its plan to bring all the grounded aircraft back into service and has brought back two of the three Boeing 787 which were long grounded.

CEO of Air India Mr. Campbell Wilson announced that the airline has recruited over 650 pilots from April this year, this is a huge achievement considering the current demand for pilots in the country and with Akasa and Indigo recruiting/retaining pilots aggressively.

Air India’s budget arm Air India Express has recently entered a legal battle with the India’s youngest and newest airline in the block, Akasa Air over recruiting of pilots. Akasa Air has sent out legal notices to 19 of its former pilots alleging that they exited the company without serving their mandatory 6 months’ notice period and joined Air India Express.

By AviationSource News 4 Min Read
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