Air India & Singapore Airlines partnership, what’s in it for both sides

On Nov 29, Indian multinational conglomerate Tata Group announced that its airlines, Vistara and Air India, would merge, making it the country’s largest international carrier and second-largest domestic carrier.

Vistara is a joint venture between Tata and Singapore Airlines, which was established in 2013, with the Indian conglomerate owning 51 per cent and SIA owning 49 per cent.

With the new merger transaction aimed to be completed by March 2024 upon regulatory approvals including from India’s aviation ministry, central bank, and antitrust watchdog, SIA shall hold a 25.1 per cent stake in Air India.

Singapore’s national carrier has committed to invest S$360 million into Air India to “fund the growth and operations of the enlarged Air India.”

Tata’s goal with the merger is an important part of rebuilding Air India into a “world-class airline,” said Tata Group Chairman N Chandrasekaran.

In years past, Air India enjoyed a stellar reputation for its elaborately-decorated planes and excellent service. However, by the mid-2000s, as it got into more and more financial difficulties, its reputation took a dive.

The carrier received complaints for the poor state of its seats in business class as well as flight delays, and suppliers and staff also experienced delays in receiving payment.

Since Singapore Airlines is widely considered to be one of the best—if not the best—carriers around the globe, what’s in it for Air India is an improvement of its standards in order for its reputation to be restored.

“We are transforming Air India, with the aim of providing great customer experience, every time, for every customer… We would like to thank Singapore Airlines for their continued partnership,” the Tata Group chairman said. 

As for SIA, it stands to “immediately gain exposure to an entity that is four to five times larger in scale compared to Vistara” the carrier said in a statement, as well as be given access to slots and air traffic rights in strategic airports in India as well as elsewhere around the world.

“With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market. We will work together to support Air India’s transformation program, unlock its significant potential, and restore it to its position as a leading airline on the global stage,” said Mr Goh Choon Phong, the Chief Executive Officer of Singapore Airlines. /TISG

Singapore Airlines will no longer serve Dom Pérignon champagne