Air India-Vistara Merger: The Tata Group is attempting to complete its integration of Air India and Vistara. The conglomerate is planning to operate the two airlines as a single airline by the end of this year.
A report by the Economic Times mentioned that the airlines have approached the civil aviation regulator and started working on merging their operations manuals and transfer of flying crew from one airline to the other.
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The report also mentioned that the move is being undertaken to simplify the conglomerate’s airline business. The two airlines will be merged to create a full service airline. AirAsia India and Air India Express have been integrated to create a single low-cost airline.
“The group is eager to complete the merger as soon as possible as it will unlock synergies and give multiple benefits in running more efficient operations. There are no ifs and buts. Both Singapore Airlines and Tata Sons want to complete the merger soon,” the report said, citing a source privy to the development.
The source also told the business daily that the exact timeline of integration depends on when the approvals from regulatory authorities come.
The airline had earlier mentioned that Vistara’s brand identity won’t be changed before 2025, however the report mentioned that advancing of the timeline is very much likely now.
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“Yes, passengers love the Vistara brand but since it has been made very clear that Vistara in the long term will become Air India, there is no benefit in delaying it,” the source told the Economic Times.
Air India is expecting a nod on the merger from the National Company Law Tribunal by next week, according to ET’s report. The Chandigarh bench of the NCLT has reserved the order in the case. Earlier this year the Competition Commission of India (CCI) had approved the merger between the two airlines in September 2023, allowing the Tata Group to form a single, full-service carrier.
A nod to the merger from the NCLT will allow both the airlines to start integrating their networks, human resources and fleet deployments.
“Currently Air India and Vistara operate flights to the same destinations around the same time and use different resources at the airport like separate check in counters. The synergy will remove such duplicities and create a more efficient operation,” the report said.
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Air India Vistara Integration
The report has said that consultants like BCG, Sabre and Oliver Wyman are working on harmonisation of the workforce and route network for the two airlines. The report mentioned that the two airlines have different manuals and need to be merged while flying staff of Vistara like pilots will need operator conversion courses. The duration is around 40 days.
The sources also disclosed that the process will be done gradually as the airlines don’t intend to ground flights as part of the process. Vistara CEO Vinod Kannan had said that they will get a clarity about their roles by May and June for the non-flying staff of the two airlines.
