Tata is planning to increase the fleet size of its low-cost carrier, Air India Express, by absorbing aircraft from its full-service carriers, Air India and Vistara. This move is in line with a broader strategy by the group to toughen its competitive edge in the fight with market leader Indigo.
The economy-configuration aircraft are to be taken over from both Air India and Vistara, according to sources. As many as 17 Airbus A320 Neo aircraft are being transferred from Air India. More importantly, 10 similar aircraft from Vistara are also likely after its merger with Air India is announced. All this work is supposed to be completed by mid-2025.
The Tata Group has proposed an aviation restructuring plan where it would merge the four airlines into two: Air India and Air India Express. The strategic reorganization would make Air India focus on the premium market, while Air India Express will have a special focus on the no-frills, low-cost segment. One of the sources that took part in the project commented that, based on the true character that should be expected from a low-cost airline, all-economy aircraft suit Air India Express perfectly because it aims to firmly establish itself as the low-cost carrier of the Tata Group.
Fleet upgrade on capacity
The Air India Express will also take over aircraft of the parent company Air India, besides absorbing 15 Boeing 737 Max planes from its contracted orders. The capacity of the airline is expected to shoot up considerably by mid-2024 based on the progress so far. In the last ten months, Air India Express has added 26 Boeing 737-8 aircraft to its fleet.
According to data from travel analytics agency OAG, LCCs hold 71 percent of the overall airline seats in the Indian aviation market. In this context, Tata Group’s proposal to upgrade Air India Express appears to be just in line with the growing demand for affordable air travel in the region.
AirAsia India merger completion
The Air India Group finally clinched the operational integration and legal merger of the low-cost carriers, Air India Express Ltd. and AIX Connect Pvt. Ltd., collectively known as AirAsia India, this earlier month.
Air India Express has significantly expanded its network, covering India, the Gulf region, and Southeast Asia. The growth is in line with the airline’s higher ambition of expansion in the number of routes, from 74 to 171. Passenger numbers have also risen sharply-more than 400 percent—since the Tata Group took over Air India at the beginning of 2022.
It launched a single brand by christening it ‘Air India Express’ in October 2023. Under the new brand name, flights previously known as AIX Connect are being offered under the brand Air India Express, given requisite regulatory approvals have been received.
