New Delhi: Vistara Chairman Bhaskar Bhat’s statement on Monday that Vistara is evaluating bidding for Air India could be the best thing that could happen to the State-owned airline.
Air India was started by JRD Tata, and if Vistara were to bid and emerge the winner, it will be beneficial for a number of reasons.
Vistara is a joint venture between Tata Sons and Singapore Airlines. So Vistara winning the bid will see Air India return to Tata Sons. For Singapore Airlines also, it will be the culmination of its failed attempts to acquire Air India. Singapore Airlines had earlier tied up with the Tatas to acquire Air India when the Vajpayee government was looking to divest the airline.
There are several aspects that make Air India a good investment option for Tata Sons. Air travel is largely a Visiting Friends and Relatives (VFR) market which sees Indians travel in large numbers to the US, the UK and Canada.
Air India has presence in all these markets. It had a head-start in launching non-stop operations between India and San Francisco with American carrier United commencing these operations several years later. With the suspension of services by Jet Airways, which was the only other Indian carrier operating to the US, the pendulum has again begun swinging in favour of the American carrier on this route. The India-US market is estimated to be around $7 billion annually.
03/03/20 Ashwini Phadnis/Business Line
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Air India was started by JRD Tata, and if Vistara were to bid and emerge the winner, it will be beneficial for a number of reasons.
Vistara is a joint venture between Tata Sons and Singapore Airlines. So Vistara winning the bid will see Air India return to Tata Sons. For Singapore Airlines also, it will be the culmination of its failed attempts to acquire Air India. Singapore Airlines had earlier tied up with the Tatas to acquire Air India when the Vajpayee government was looking to divest the airline.
There are several aspects that make Air India a good investment option for Tata Sons. Air travel is largely a Visiting Friends and Relatives (VFR) market which sees Indians travel in large numbers to the US, the UK and Canada.
Air India has presence in all these markets. It had a head-start in launching non-stop operations between India and San Francisco with American carrier United commencing these operations several years later. With the suspension of services by Jet Airways, which was the only other Indian carrier operating to the US, the pendulum has again begun swinging in favour of the American carrier on this route. The India-US market is estimated to be around $7 billion annually.
03/03/20 Ashwini Phadnis/Business Line
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