IS AIR INDIA BECOMING TATAS' ACHILLES' HEEL?

THE sale of the collapsing government-owned Air India to the Tata Group on January 27, 2022 was greeted with some fanfare.

- GURBIR SINGH

Though there was grumbling at the under pricing of Air India’s massive assets at just %18,000 crore, the Tata acquisition had popular support.

The group is known for efficiency and good consumer ethics, and there was guarded hope Air India will emerge as a good, competitive airline.

More than three years after the Tata takeover, Air India is struggling. It has not been able to shed its poor, sarkari record. Passenger services attract a litany of complaints, losses have mounted and all those promised ramp-ups in the form of new and refurbished aircraft can hardly be seen.

The crisis is evident. A Friday, October 31, report of Bloomberg says Air India is seeking a minimum of %10,000 crore in financial support from its owners Tata Sons, which owns 74.9% in the airline, and minority owner Singapore Airlines (SIA). This infusion will fund overhauling Air India’s systems and services.

Though Air India’s revenue increased 15% to %8,636 crore for the year ended 31 March, 2025, (combining revenues of Air India, Tata SIA Airlines and other subsidiaries), its losses widened by 48% to %10,859 crore from 7,356 crore in the previous year. This is significant as Air India now is among the largest contributors to the Tatas’ topline.