Introduction
Following the acquisition of Air India by the Tata Group, plans for the merger of Air India and its sister brand Vistara are underway, albeit with a deliberate approach towards consolidation. Sources familiar with the matter indicate that Tata Sons intends to maintain separate management teams for Vistara and Air India for at least another year post obtaining all necessary clearances for the merger.
The Air India brand has suffered from years of neglect, characterized by aging aircraft, subpar service, operational inefficiencies, and controversies that have marred its reputation. Under Tata’s stewardship, however, Air India is undergoing a significant overhaul, marked by the introduction of a new brand identity, upgraded aircraft, and improved staff and services.
In contrast, Vistara, a relatively newer brand, has earned a reputation for its efficiency and high-quality in-flight experiences, fostering strong consumer trust. The board aims to elevate Air India to Vistara’s standards of operational efficiency, service quality, and brand trust before proceeding with integration. Notably, brand experts have advised Tata to retain the Vistara brand, given its stronger position in the market. This cautious approach reflects Tata’s strategic intent to revitalize Air India while preserving the distinct identity and reputation of Vistara, ultimately ensuring a seamless and successful integration process.
Key Points
- Tata Group’s Strategy: Tata Sons plans to merge Air India and Vistara but intends to keep their management teams separate for at least a year after obtaining merger clearances.
- Air India’s Transformation: Air India, plagued by neglect and controversies, is undergoing a significant transformation under Tata’s ownership, with efforts to upgrade its brand identity, fleet, staff, and services.
- Vistara’s Reputation: Vistara, a relatively newer brand, is known for its efficiency and high-quality service, earning significant consumer trust in the market.
- Elevating Air India: The board aims to raise Air India’s operational standards to match those of Vistara before integrating the two brands, reflecting a strategic focus on quality and brand trust.
- Retention of Vistara Brand: Brand experts suggest retaining the Vistara brand due to its stronger market position and reputation, highlighting the importance of preserving brand equity in the merger process.
- Strategic Approach: Tata’s cautious approach aims to revitalize Air India while ensuring a seamless integration process that preserves the distinct identities of both airlines.
About Air India
Founded by JRD Tata, India’s inaugural commercial pilot license-holder, Air India boasts a rich history marked by numerous milestones in aviation. The company’s fleet comprises an impressive array of 128 narrow-body and wide-body Airbus and Boeing aircraft, catering to both passenger and cargo transportation needs across the globe. Committed to enhancing its services, Air India has placed orders for an additional 470 new aircraft.
Through its website, users can conveniently explore international and domestic flight options, including one-way, round-trip, and multi-city stopovers, while also accessing real-time flight status updates, schedules, and promotional offers. Furthermore, the website serves as a gateway to Air India’s corporate information and policies, featuring essential details such as its Corporate Identification Number (CIN), registered office address, annual returns, disclosures, composite scheme of arrangement, and various codes of conduct and policies.
About Vistara
Vistara, a collaborative venture between Tata Sons Private Limited and Singapore Airlines Limited (SIA), operates under the name TATA SIA Airlines Limited, with Tata holding a 51% stake and SIA holding 49%. In 2013, these esteemed entities united to realize a shared aspiration: to introduce a distinguished air travel experience in India. Both Tata, with its historical aviation connections, and Singapore Airlines, recognizing India’s aviation potential, had previously attempted to enter the Indian market.
After regulatory changes in 2012, the partners secured approval for their collaboration, incorporating Vistara’s holding company, TATA SIA Airlines Limited, on November 5, 2013. Vistara aims to redefine Indian air travel, blending Tata’s and SIA’s renowned service excellence. Its name ‘Vistara,’ derived from the Sanskrit ‘Vistaar,’ embodies the vastness of the sky, while its tagline ‘fly the new feeling’ symbolizes the transformation it seeks to bring. Commencing operations on January 9, 2015, Vistara swiftly expanded, serving 50 destinations with over 300 daily flights and a fleet of 67 aircraft, delighting more than 50 million customers.
Summary
