Tata Group said the amalgamation of Air India and Vistara was complete on Tuesday, establishing a single full-service airline under the Air India banner, a major step towards the growth of India’s aviation sector. As for Vistara, Singapore Airlines, which used to own a 49% stake in this venture, now controls 25.1% in the merged Air India entity. In this regard, SIA has committed further to additional investments to foster the development of the newly expanded airline.
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The merger involving Air India and Vistara joins the existing service brand image of Air India with Vistara’s superior services to attempt to challenge international carriers and increase India’s exposure in the international aviation market. Air India, the new and big Air India, seems to target international as well as domestic markets as the country’s flagship full-service carrier with better access to fleets, flexibility, and upgraded service delivery. Air India is part of Tata’s broader plan to revive and develop the airline company which it bought from the Indian government in 2021. The wider strategy of Tata for Air India is to rapidly build the fleet, update and enhance the services, and leverage the premium brand image of Vistara.
The integration with Singapore Airlines also adds operational experience, managerial backing, and a source of fresh cash inflow to Air India that can help it attain its modernization and expansion processes. Executives in the Tata group noted that Jet Airlines will derive operational synergies and a better fleet utilization master plan that will offer travellers a ‘seamless and superior’ flying experience. Speaking of Air India, industry specialists regard this step as a challenge to revitalize the flag carrier and prepare it for competing with other international giants in the industry at large.
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