The chief executive of Air India said the carrier is embarking on the biggest turnround effort in airline history as he outlined ambitions to turn India into the next major aviation hub following a huge order for new planes.
Campbell Wilson said he hoped to return the recently privatised airline to the “upper echelons” of global aviation as part of an overhaul by new owner Tata Sons.
Wilson has begun to rebuild an airline that has been bleeding $2.4mn a day, is upgrading a fleet of antiquated planes, and runs on some of the oldest information technology in the industry.
“It’s certainly the biggest aviation turnround, I think, that I am ever aware of . . . I don’t think there is anything that has ever been attempted like this before,” Wilson told the Financial Times.
Tata, the industrial group that acquired the formerly state-owned national carrier after a $2.4bn bid in 2021, last year began a five-year turnround programme codenamed Vihaan.AI — derived from the Sanskrit for “dawn of a new era” — aimed at transforming the brand following nearly 70 years in state hands.
Last month the airline announced its global ambitions with an order for 470 planes from Airbus and Boeing, one of the largest ever such purchases.
The airline is recruiting staff and pilots and rolling out services in hope of capitalising on India’s growing economy and population — from this year the world’s largest — and diaspora, many of whom fly to India via the Gulf.
Wilson said he planned to triple passenger numbers and to eventually challenge Gulf airport hubs including Dubai and Qatar for layover traffic.
Tata is also seeking regulatory permission to merge Vistara, its airline joint venture with Singapore Airlines, into Air India. As part of the planned merger, Singapore Airlines is investing about $250mn in Air India, giving it a 25.1 per cent stake.
Air India is also integrating its Air Asia Express and Air Asia India into a single carrier.
Wilson was unable to say when the carrier would turn a profit, but pointed to “so much low-hanging fruit” for cost cuts and revenue growth, including modernising basic functions such as scheduling, fuel and insurance contracts and its frequent flyer programme.
He said the airline was the last in the world to switch away from an old reservation system, and until the takeover had last hired anyone to work in IT in 2007.
Air India’s new owners have started to invest heavily in IT — in a business where many processes were formerly manual — and installing new seats and in-flight systems in its shopworn existing fleet.
Wilson said he did not “want to speak ill” of the airline’s previous leaders, who he said were constrained by the bureaucracies of public ownership.
“They kept it going. They kept it going long enough to be purchased.”
But some international observers have questioned whether such a turnround is possible, given how Indian carriers have long struggled to compete on the global stage.
Ryanair chief executive Michael O’Leary, another major Boeing customer, questioned whether Air India would “ever take all those aircraft”.
“The history of Indian aviation is boom, bust, boom, bust,” he told the FT.
Read the full article here
