“Someday, you’ll be looking back on your life. At the memories, this is gonna be one of those nights.” – Tim McGraw
This statement by Tim McGraw is so true for Tata Sons as it reacquires Air India. Air India has been the flag bearer of our country for quite some time now. It all started with Tata Airlines in July, 1930. JRD Tata was the chairman and founder of the airlines. Those were the glorious years of the airline, which became more popular after it was renamed as Air India in 1946. But after it was nationalized in 1953, it has seen its fair share of disappointments. Fast forward to October 8, 2021, now it has been reacquired by Tata after a long 70 years, so the hopes are high now. If we look at the airline, then there are various points which can depict the advantages and disadvantages of the airline in the present era. But with a positive mindset and the good reputation of Tatas, things can change quickly for the debt-ridden airlines. There are some drastic changes which needs to be done in terms of management and also from a customer point of view.
The challenging steps
First of all, new directors and management needs to be appointed in order to make the airline more professional, refined and in order to make it look more comfortable with the changing needs of the users of the current time. The other thing which also needs to be done is changing the working habit and procedure of the airline as it will help in changing the image of the airline to some extent.
Secondly, one of the main things which needs to be done is to change the in-flight entertainment options of the airline. It is necessary because with changing times the users are also expecting better feature and facilities in the flagship airline of India. It is also necessary because there is dire need for such facilities in long haul flights. Then there is also requirement for newer aeroplanes and repairment of the existing aeroplanes which are currently with the airlines. These changes can also help the airline to present some challenge to the foreign airlines which are currently popular or are gaining popularity among the people. All of this will definitely need a huge amount of investment by the new owners.
Third thing which is needed is the proper utilization of the existing routes on, which it is currently serving the passengers. It can be done by reducing the number of connecting flights, which are currently being offered by the airline. This is because after the pandemic the need and requirement for point-to-point travel has increased drastically. Now, this can be done by taking help from the current services which are being offered by Vistara Airline and Air Asia, the subsidiaries which are also owned in- part by Tata Sons.
The fourth thing which needs to be done is utilising the already existing companies of Tata which can help the airline in improving its services. The biggest example can be TCS. If TCS and its services are utilized properly then it can help Air India in improving its operational cost to some extent.
Then, there is also requirement of reducing the burden of debts from Air India as it can hamper its operations in future. The other thing which also needs to be looked at is the existing contracts which the airline currently has with other companies or organizations. This way the partnerships which are proving to be costly for the airline can be altered in one way or the other.
The competitive space
But apart from the above-described steps, there are also some dangers which are lurking around the Maharaja. First problem can be the rise of home-grown airlines like Indigo and SpiceJet. These airlines are local in nature and are rapidly gaining popularity and ground among the people and in the airline sector respectively.Secondly, there is also the threat of increasing fuel prices and other air related expenses or charges as the travelling load of customers will increase slowly and steadily after the pandemic. There is also a problem of foreign airlines which are well established and are trying to make way into our domestic airline sector with the help of partnership from some of the smaller airlines.
The bright side
But there are some advantages which are attached to the Air India. First of all, the brand name and the image that depicts Indian and is easily recognised worldwide. Then there are also the flying rights which it has over many major destinations. There is also the added advantage of slots available at major airports world over like JFK and Heathrow. According to the reports from 2019, it is also one of the major carriers of our country which has around 20% market share in the international flights from our country. It’s fleet along with that of Air Asia and Vistara will collectively sum up to around 250, which can definitely help in improving the business scenario for Air India because of the sheer size.
Then there is also some part of glorious history which is attached to the airline. First of all, until JRD Tata was its chairperson, it was one of the best airlines from our country. It was able to provide the best aeroplanes with great facilities to its passengers. Hence, it was also given the name “Maharaja”. In the year 1990, it also helped in the largest evacuation by air in history when Kuwait was invaded. During the pandemic also, it helped in carrying the stranded passengers to and from India under the Vande Bharat mission.
This way the airlines can be turned over to profitable ways, if the decisions taken by the new owner are positive. The above-mentioned points do help us in understanding the present scenario of the airline to some extent. Now, it remains to be seen that what steps will provide what benefits to the “Maharaja” in the near future.
By: Raunak Jha