From govt headache to record plane deal: All you need to know about the Air India story
2 min read . Updated: 15 Feb 2023, 02:13 PM IST
Premium- The Tata Group-owned Air India's record deal for jets from Airbus and Boeing has happened at a time when the carrier plans to become ‘a world-class proposition’
Air India returned to the Tata Group after eight decades, which saw the national carrier witnessing several ups and downs. The Centre's disinvestment process started two decades ago, when former Prime Minister Atal Bihari Vajpayee invited bids to sell the government's 40 per cent stake in the airline. Singapore Airlines and Tata Group had showed interest, but the disinvestment process couldn't be completed then.
Since then, the Central government has tried to sell the Air India, burgeoning with losses, to raise funds. It finally succeeded in its bid back in October 2021.
Now, the Tata Group-owned Air India's record deal for jets from Airbus and Boeing has happened at a time when the carrier plans to become "a world-class proposition", in the words of Tata Group Chairman N Chandrasekaran.
It deal will also put the carrier on a stronger footing to compete with domestic rival IndiGo, which has a majority share of the market and a strong position in regional flights as well.
Here's everything you need to know about AI's journey:
Known as as Tata Airlines, Air India was founded by JRD Tata in 1932. The airline was nationalised around the time India gained independence in 1947.
The carrier has never returned a profit since the merger involving Indian Airlines over a decade ago. It managed to lose around ₹23 crore each day, taking its net loss for 2018-19 to as much as ₹8,400 crore.
The airline had returned to the Tata Group nearly 70 years after its nationalisation, with the Central government picking up the salt-to-software conglomerate as the winning bidder for the state-run airline in 2021.
Tata Sons had won a bid of ₹18,000 crore to regain control of the government airline in 2021.
Tata Sons chairman emeritus Ratan Tata had welcomed the airline back into the fold of the Tata Group, tweeting an old picture of the late JRD Tata getting down from an Air India aircraft.
On Tuesday, Air India said it will buy a total of 470 wide-body and narrow-body planes from Airbus and Boeing, accelerating the rebirth of a national emblem under new owners Tata Group.
The total deal value is estimated to be $80 billion (approximately ₹6.40 lakh crore) as the airline expands its operations.
Air India said the first of the new aircraft will enter service in late this year and the bulk of the jes are to arrive from mid-2025 onwards.
US President Joe Biden has termed the agreement "historic" and discussed it by telephone with Prime Minister Narendra Modi – part of a flurry of high-level reactions as the scale of the country's needs provided a rare bonanza for both competing plane giants in an industry where the winner usually takes all.