Air India aims to triple fleet size in next five years
NEW DELHI: Air India is looking to expand its fleet size by threefold and increase its domestic and international market share to 30% in five years, chief executive Campwell Wilson said on Tuesday.
The expansion can either be organic, or via organic and inorganic growth opportunities, Wilson added.
Tata Sons-owned Air India currently has a fleet of 113 aircraft. The group operates three other airlines, including Airasia India (28 planes), Vistara (53), and Air India Express (24), taking the group’s total fleet size to 218. Of these two are operated through joint ventures. If all the airlines are merged under a single brand, then Air India will need around 120 aircraft to triple its fleet size.
As per Air India, the airlines will take 25 Airbus narrow-body aircraft and five Boeing widebody planes on lease, including 21 Airbus A320neos and four A321neos, as well as five Boeing B777-200LRS. The planes will enter service from late 2022.
Air India is also in talks with aircraft and engine manufacturers to place a fresh order, which will have a sizeable number of narrow-body as well as widebody aircraft.
“The airline is in discussions with aircraft and engine manufacturers on procuring new aircraft. I would not put a number on it because negotiations are still ongoing. We also have a view on the proportion of wideand narrow-body, and the increase is going to be a significant number of both,” said Wilson.
Earlier this week, Singapore International Airlines said it was in talks with Tata group to explore a merger of Vistara and Air India. Currently, Tata group holds a 51% stake in Vistara, while Singapore Airlines owns 49%.
Tata Sons is working on a consolidation strategy to save costs, build synergies by optimizing aircraft utilization and routes to gain a larger share of the domestic market.
Currently, the airline has a domestic market share of 10% and an international market share of 12%.
However, a merger between Air India and Vistara may take a year to complete. Meanwhile, Boeing Co. is offering 737 Max jets once meant for Chinese customers to Air India as the US planemaker tries to offload some of the 140 aircraft it is currently not allowed to deliver to Beijing, Bloomberg reported.
In the first phase of the transformation, Air India will address issues such as on-time performance, food and refunds, that are “tarnishing” the airline’s brand, said Wilson. In the second phase, the carrier will accelerate investment in people, systems and equipment. It will aspire to become a “worldclass” airline toward the end of the five-year overhaul plan, he added.
The airline has restored 17 grounded aircraft while a dozen are yet to return to service. It is also in talks with suppliers to refurbish existing wide-body aircraft, which will require significant engineering work, Wilson said.
Describing the revival of Air India as a “Test match” and not a“t20 match”, Wilson said that first, the airline wants to restore its reputation and “we have evidence to indicate that the progress is being made”. The loss-making carrier, which was taken over by Tata group in January, has put in place a revival plan called ‘Vihaan.ai’.