Tata Sons have begun work on merging low-cost carrier AirAsia India with Air India’s budget carrier Air India Express, The Economic Times reported.
The Tata group is looking to achieve synergies and cut operational costs once it takes over Air India. Tata Group may soon be operating in the low-cost space in international and domestic skies.
AirAsia-Air India Merger
Owning an 84% stake in AirAsia India, Tata’s first step in creating a single airline entity will be easy. Tata is yet to conclude talks with Singapore Airlines (SIA) on integrating the schedules of Vistara and Air India, the people said.
“The plan on the table is to operate the existing AirAsia India fleet in the domestic skies and also provide domestic connections to the current Air India Express’ international network,”
“The plan also is to keep both Airbus and Boeing fleet running.”
A person aware of the group’s plans told ET.
Reason Behind The Merger
The merger, according to one of the people featured in the report, is a sensible step!
Tata owns majority ownership in AirAsia India, allowing for simpler integration.
According to the person who asked not to be identified, AI Express is likely to switch to AirAsia India’s reservation system, which is used by several low-cost carriers.
“Plan is also to offer similar branding, food menu and other services,” he said.
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