Two years after Tata Group's $2.4 billion acquisition of Air India, the airline's transformation into a world-class carrier is facing significant challenges, including an ageing fleet, parts shortages, and persistent flight delays. Despite ambitious efforts to modernize, Air India's journey is complicated by global supply chain issues, which are more "acute" for the Indian flag carrier, according to CEO Campbell Wilson.
As Air India progresses through its five-year turnaround plan, it struggles to catch up to rivals like Emirates and Qatar Airways, which already boast newer fleets and premium services. Air India has placed a historic order for 470 new planes, including 70 widebody jets, and launched a $400 million initiative to refit old aircraft. However, delays in receiving customized business and first-class seats have pushed the widebody upgrades to early 2025, further postponing the airline's modernization goals.
The airline aims to rebuild its reputation by upgrading its fleet and improving passenger experiences, but this effort is hampered by lower aircraft utilization and unreliable flight schedules, especially on long-haul routes. In August, only 18% of Air India's flights to Europe and 48% to North America arrived on time, underscoring the need for improvements in maintenance and operations.
To address these issues, Air India plans to shift to its own maintenance facility by 2026, in collaboration with Singapore Airlines subsidiary SIA Engineering. In the meantime, the airline is ring-fencing its most profitable routes, such as Mumbai to San Francisco and Delhi to London, by deploying modern planes.
Since its privatization, Air India has made progress, with increased capacity, improved passenger load factors, and a 60% reduction in net losses to $532 million. However, Wilson acknowledges the long road ahead, stating, "Two years in, I think we're in a good place, but there's still much work to be done."
As the airline merges with low-cost carriers Air India Express and AirAsia India, and prepares to integrate Vistara in November, all eyes are on its efforts to restore its former glory and compete with international giants.