Today, 27th January 2022 is a historic day for Indian aviation. Today is the day, India’s flag carrier Air India finally returns home!
69 years after it was nationalized, Air India has been formally taken over by the Tata Group today.
Air India was founded by J.R.D. Tata in 1932, and was originally called Tata Airlines. It was later converted to a public limited company and renamed as Air India. Back in the day, Air India was one of the world’s leading airlines both in terms of service and technology. It was the first Asian airline to enter the jet age when it inducted the first Boeing 707 in 1960.
A decade later, Air India inducted the first Boeing 747-200 into its fleet and introduced the Palace in the Sky branding and livery.
It was nationalized and taken over by the Government of India in 1953. Air India focused on international routes while a new airline company, Indian Airlines was formed to take over domestic routes.
The airline had a rocky history as a government owned entity, and its service standards dipped. Poor customer service, low on-time performance, worn out aircraft interiors tarnished the reputation of the Maharaja. Multiple efforts were made to improve the airline’s standing through the years, but none could turn its fortunes around.
As part of a consolidation exercise, Air India was merged with Indian Airlines in 2007 to create a mega carrier with a large, diverse aircraft fleet and an even larger workforce. It was invited to join Star Alliance in 2007 but with the airline merger proving to be a difficult undertaking, Air India could not meet the joining requirements.
After an excruciatingly long process of integration, Air India finally joined Star Alliance in July 2014, a full seven years after it was originally invited! It was and is the only airline from India to be part of a global airline alliance.
The Government of India had been making efforts to privatize the airline for decades, but none of those were successful. The airline kept posting losses year after year and had to be bailed out using taxpayer money. At the same time, the influx of lean privately operated airlines, especially low cost carriers kept eroding Air India’s market share.
Starting 2020, the privatization efforts gathered steam, and finally in October 2021, the Tata Group (through a Special Purpose Vehicle – Talace Private Limited) won the bid to acquire Air India from the Government of India, thus completing a full circle in the airline’s history.
The future of Air India looks bright in the hands of its original owners. The Tata Group is known for its high standards in customer service especially in the hospitality and travel industries. How they manage to tame the jumbo (no pun intended 🙂 ) remains to be seen. The decline in air travel due to the pandemic as well as other issues such as handling the bloated workforce and integrating Air India with other airlines in the portfolio such as Vistara are immediate challenges that will need to be addressed.
Here’s wishing the Tatas all the best, and hope they can restore the Maharaja to its former glory!