[arpanjha]

Originally Posted by Lalvaz

The article clearly states that the govt is paying the outstanding amounts in bits and pieces. As per this article, The govt still owes Air India for past invoices to the tune of 798 cr.

One question from my side, the Govt and its many officials will continue using Air India for their travel needs, and I seriously doubt they will come out of the habit of misuse anytime soon, will the same pattern be followed? Like, they summon an aircraft and take the services, and the TATAs will submit a pending invoice to be paid months later (if paid at all)? I doubt this.

How will the government or ministries use this or any other airline for Government purposes now onwards?

[fhdowntheline]

Originally Posted by arpanjha

One question from my side, the Govt and its many officials will continue using Air India for their travel needs, and I seriously doubt they will come out of the habit of misuse anytime soon, will the same pattern be followed? ?

The govt employees will no longer be obliged to use Air India anymore once the ownership is transferred to private hands.

It would be interesting to see how the restructuring of operations happens, with so many entities and aircraft types, from Do-228 (Air India regional) to B747-400. For example, does Air India even need to run the Express brand ? Those B737s are a complete outlier in their scheme of things, since both Vistara & Air Asia (with whom the final entity could possibly be merged) operate Airbuses. There again, there are A319s, A320s and A321s. Perhaps the A319s may need to go. And (sadly) the B747s also need to go. They have had a glorious run, but its time.

[Newtown]

What happens to Air India ONE? Who owns, maintains and staffs for those flights? Since they were recently retrofitted with advanced kit, does Air India do that? I am assuming these won't be part of the deal, is that a correct understanding ?

[V.Narayan]

Originally Posted by V.Narayan

Thought I'd never see this happen in my lifetime.

And the Oscar goes to.....Snatching Air India away from the Tata's was probably one of the worst excesses of the license raj and the philosophy, 'the bureaucrat knows best' and 'the private sector cannot help build the nation'. Those philosophies were, IMHO, humbug the real morive was power and access to favours and those bureaucrats and politicians in 1953 knew that.

Coming from this industry and having participated in one earlier round of this Air India divestment process I can only say I am over the moon. And I've promised myself not to hiss and curse the current Govt for a whole fortnight. At Rs 18,000 crores i.e. ~$ 2.25 billion this is a very reasonable price. It also means the Govt kept its expectations and bid conditions sensible which was not the case in 2018 or 2015/16. I'll also give credit to the HS Puri till recently the Minister of Civil aviation for navigating this through the Govt labyrinth.

One pocket that may not be happy will be the AI pilots who have repeatedly displayed the willingness to hold the airline and the nation to ransom for their demands. Thank God we will not have 'master of all trades' IAS officers trying to run an airline after stepping out of the Dept of Animal Husbandry. I hope, for the sake of our economic solvency that this means the Govt will have the confidence to move forward with privatization in other areas too. I won't second guess the strategy Tata's will follow with 3 airlines and one giant MRO under their care now. The permutations are too many. Only points one can reasonable guess are that the multiple aircraft types will be reduced to a smaller number; the MRO will become a separate profit centre serving all 3 airlines plus others; there will be some merger - at least one and exchange of slots.

I wonder if we can exercise political muscle to get back the lucrative Air India routes that were sold in the 2004-2011 period with little benefit to Air India or the Govt.

[Theyota]

Originally Posted by V.Narayan

I won't second guess the strategy Tata's will follow with 3 airlines and one giant MRO under their care now. The permutations are too many. Only points one can reasonable guess are that the multiple aircraft types will be reduced to a smaller number; the MRO will become a separate profit centre serving all 3 airlines plus others; there will be some merger - at least one and exchange of slots.

There is no way that all 3 airlines will survive as separate entities. I cannot think of how this would make sense from any perspective. It is only a matter of time before strategy for Vistara has to be figured out. Down the lane, I see Vistara being merged into Air India with SIA getting a minority stake in the combined entity. I am sure SIA folks are scratching their heads about how to go forward with the situation on hand. Vistara as a brand may still survive as a regional airline or something of the sort. Air Asia will have to be absorbed under Air India Express and maybe they would have to establish a complete new brand for the low cost operation and kill both Air India Express and Air Asia.

[airbus]

Originally Posted by Newtown

What happens to Air India ONE? Who owns, maintains and staffs for those flights?

Ownership of two Boeing 777-300ER (call-sign Air India One) was transferred to the Government of India, which are now operated by Air Headquarters Communication Squadron of the Indian Air Force, based at Air Force Station Palam, New Delhi.

Air India Engineering Services Limited was helping the Indian Air Force in maintenance of these Boeing 777. With the change of ownership of Air India, not sure if there will be any change in maintenance contract.

[Lalvaz]

Originally Posted by V.Narayan

And the Oscar goes to.....Snatching Air India away from the Tata's was probably one of the worst excesses of the license raj and the philosophy, 'the bureaucrat knows best' and 'the private sector cannot help build the nation'. Those philosophies were, IMHO, humbug the real morive was power and access to favours and those bureaucrats and politicians in 1953 knew that.

Coming from this industry and having participated in one earlier round of this Air India divestment process I can only say I am over the moon. And I've promised myself not to hiss and curse the current Govt for a whole fortnight. At Rs 18,000 crores i.e. ~$ 2.25 billion this is a very reasonable price. It also means the Govt kept its expectations and bid conditions sensible which was not the case in 2018 or 2015/16. I'll also give credit to the HS Puri till recently the Minister of Civil aviation for navigating this through the Govt labyrinth.

One pocket that may not be happy will be the AI pilots who have repeatedly displayed the willingness to hold the airline and the nation to ransom for their demands. Thank God we will not have 'master of all trades' IAS officers trying to run an airline after stepping out of the Dept of Animal Husbandry. I hope, for the sake of our economic solvency that this means the Govt will have the confidence to move forward with privatization in other areas too. I won't second guess the strategy Tata's will follow with 3 airlines and one giant MRO under their care now. The permutations are too many. Only points one can reasonable guess are that the multiple aircraft types will be reduced to a smaller number; the MRO will become a separate profit centre serving all 3 airlines plus others; there will be some merger - at least one and exchange of slots.

I wonder if we can exercise political muscle to get back the lucrative Air India routes that were sold in the 2004-2011 period with little benefit to Air India or the Govt.

Every single post of yours is full of common sense, which seem so uncommon now. Thank you for sharing your views in a frank yet respectful manner, each and every time.

[Arun_S]

Quite delighted to see Air India back with Tata's.

For Tata's to succeed there should be support from government as well on policy decisions.

Ex Below: If these type decisions are made, nobody can run an airline in India.

I remember reading somewhere not able to locate the link now, in 1997 the now defunct airline wanted to purchase new planes as part of expansion, as they were well connected in political circles, policy was changed were taxes on buying new planes was made less while leasing was made costly.

Again in 2006 when Air India was about to place it orders, the same gentleman, used his connections to change it back, which made AI pay huge taxes.


If there is change in government, there shouldn't be any investigation as such on price and what not. Hopefully this being sold to Tata's such a thing would not be there, had it been to the other bidder for sure we could have expected that.

[V.Narayan]

Addressing, to best of my knowledge, some of the comments & questions raised in earlier posts.

The Govt may continue to use Air India for official purposes but that will be a commercial contract between them and the new owners. And what credit terms Tata consent to is between two contracting parties. With 2 B777 and 3 B737 and 4 Embraer Legacy 600 aircraft in the IAF VIP fleet the Govt of India has less need for Air India today than say as recently as 8 years ago.

Member @Arun S very correctly pointed out to the abject corruption in the Ministry of Civil Aviation in the 1990s and the 2000s. That was true on a full 70mm screen in vivid Eastman colour. Please don't assume where my political inclinations lie but since 2014 corruption at the MoCA has declined significantly. No, it is not all clean but the days of PP and Jet Airways playing puppeteer are long gone.

The maintenance of the B777 will to best of my assessment continue with Air India Engineering. The B737s are also maintained by the Indian private sector working in close collaboration with Boeing.

Human resources - the cabin crew of Air India are competent mind you. The job of the cabin crew is safety not drinks and snacks. I'd bet on Air India cabin crew over those of say Spicejet or Go Air any day. The engineers & technical staff on the ground are good men and women led by laggards burdened by a Govt bureaucracy. Their technical staff have engineering competence coupled with lazy management practices and discipline. When ever I have recruited ex-Air India engineers & technicians after a run in period they have almost always been superb. Pilots - competent but led by a union/association that had them thinking they are God's answer to mankind.

Originally Posted by Theyota

There is no way that all 3 airlines will survive as separate entities. I cannot think of how this would make sense from any perspective.

Sir, I did not say they will run all three airlines! I spoke of at least one merger. But at this stage being but a small ex-businessman with little exposure to corporate strategy all I can say is that with 3 airlines, 2 JV partners, 1 MRO, 3 families of route slots & at least two routes to raising capital {IPO & a big PE} the permutations are endless. I would hesitate to guess or be an armchair advisor at this stage. I'm sure Tata's have given it thought. All I can say is that Tata's are now well positioned to becoming one of the largest airline groups in Asia over the next 7 to 10 years.

[shancz]

Originally Posted by V.Narayan

1. Human resources - the cabin crew of Air India are competent mind you. The job of the cabin crew is safety not drinks and snacks. I'd bet on Air India cabin crew over those of say Spicejet or Go Air any day. The engineers & technical staff on the ground are good men and women led by laggards burdened by a Govt bureaucracy.

2. Their technical staff have engineering competence coupled with lazy management practices and discipline.

3. All I can say is that Tata's are now well positioned to becoming one of the largest airline groups in Asia over the next 7 to 10 years.

1. Thanks this reaffirms my perception from what I experienced in the aircrafts and on ground. Their crews have done stuff that I can't imagine happening in any other airline nor have I experienced it.

2. True, discipline and efficiency is a direct function of management. They are skilled but let down by management.

3. Absolutely and also no point guessing anything now. Like you rightly said the combinations are immense with such a wide playing field. Honestly from a management perspective its isn't just a big challenge but a dream too.

Something like scaling Mt. Everest, daunting, demanding, needs optimal planning but the outcome is unparalleled.

[dust-n-bones]

Definitely good news. I also wish

• the petroleum ministry does something about the absurd taxation on ATF (aircraft fuel). Is a big component of airline costs, and should help grow the industry profitably as a whole. If done right, India can be a natural hub for international routes feeding into the neighborhood.
• the govt should dissolve its civil aviation ministry. It made morose sense while the govt treated Air India as a free ride. We now need an effective regulator (DGCA), not a ministry.

[RM Motorsports]

Amul does it again. Just fantastic!

[anjan_c2007]

Now my dream trip will hopefully be with these ingredients :-

- getting both a hassle and breakdown free ride on a cab aggregator's, new generation Tata taxi from halting place to the airport.

- getting a boarding pass from a more courteous staff and soon hopping into an Air India jet on time, sans the sudden groundings and also the sudden, negative, surprise announcements at the airport, detrimental to its passengers.

- the flight will hopefully be manned by a courteous crew full of youth and synergy to prop up airlines' sagging image.

- the age old, rickety white and orange Air India, Tata buses plying in several airports (pollution norms perhaps don't apply on these) will hopefully make way for chic and contemporary buses, though again from Tata (never mind).

- And the age old, courteous Maharaja, the Air India mascot will hopefully be revived from its decent burial during recent decades.

[ZenMaster]

What they now need is a proper Brand Building excercise (inside and out). The news of Tata buying Air India itself has probably done half the job.

Over the years, the Air India name has lost its sheen. People view it as an old Airline run using decades old practices by corrupt people. The Air India name has been dragged through the mud a lot sometimes unnecessarily.

I hope Tata gives Air India a full refurbishment and Fresh Coat of paint.

[procrastinator]

It will be interesting to see Tata managing its existing investments in Air Asia India and Vistara Airlines.
Vistara is already expanding to International routes and Air Asia India too is following.

I am not a business guy but I feel Tata can dominate aviation sector in domestic market easily in coming years.