Saturday, October 02, 2021

Read About Tata's Growth In Airlines Business As Firm Emerges Frontrunner To Run Air India

In a major decision on Friday, the Tata Group won the bid to take over national carrier Air India. The bid marks Tata Sons' takeover of Air India again after 68 years since it was operated by the Government of India. In addition, it further cements Tata's position in India's aviation sector as the deal will boost the company's airline businesses. Apart from Tata, the only second bidder for Air India was SpiceJet chief Ajay Singh, in a personal capacity.

Even so, the Indian conglomerate is not new to the airline business as it already has made its mark in this sector. The inception of Air India began in 1932 when it was initially established as Tata Airlines. Tata Airlines was founded by India's legendary industrialist and philanthropist JRD Tata, who at the time was also India's first licensed pilot. Tata himself flew the company's first single-engine de Havilland Puss Moth aircraft. However, the airline was later nationalised and taken over by the Government of India.

Tata Sons Airline Business:

Air Asia 

Even so, the Tata Group still maintains a presence in the airline sector. Back in 2012, Air Asia expressed that it was keen to have more presence in India. Therefore a joint venture was announced which also included Tata Sons. Initially starting off with a 30 per cent share, the Indian conglomerate, therefore, marked its reentry in this sector after 60 years. Over the years, Tata Sons increased its shares and in 2020, the group announced that it would increase its holdings to over 84 per cent. 


Furthering expanding its presence in the Indian aviation sector, Tata Sons and Singapore Airlines announced a joint venture after India opened up its airline sector for 49 per cent FDI. The decision by the two parent companies was made in 2013 and Tata Sons own a 51 per cent share in Vistara Airlines. Vistara commenced its operations in January 2015 and was one of the first airlines to operate domestic flights out of Mumbai's newly inaugurated Terminal 2. The company is registered as TATA SIA Airlines Limited. The company achieved success soon and on August 20, 2015, it declared it had carried half a million passengers in just over seven months of operations. 

In July 2020, Vistara informed that it had received its first A321neo aircraft, which has 188 seats in a three-class cabin configuration, from Airbus' Hamburg production facility. The A321neo is a narrow-body aircraft that can be used on short to medium-haul international routes that are within seven hours of flying time. In a statement, Vistara said this aircraft would consist of 12 seats in business class, 24 in premium economy class and 152 in economy class. The business class seats are in 2*2 configuration while the other two classes have 3*3 set-up. Prior to that, in February 2020, the airline had inducted its first wide-body aircraft - Boeing 787-9 Dreamliner for long-haul international operations. 

01/10/21 Shloak Prabhu/

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