SIA and Tata Sons to merge Air India and Vistara

SINGAPORE, Nov 29 (Bernama) -- Singapore Airlines (SIA) and Tata Sons (Tata) have agreed to merge Air India and Vistara, with SIA also investing S$360 million in Air India as part of the transaction.

Vistara, a joint venture between SIA and Tata, is an Indian full-service airline.

“With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market,” said chief executive officer of SIA, Goh Choon Phong, in a statement issued here today.

“We will work together to support Air India’s transformation programme, unlock its significant potential, and restore it to its position as a leading airline on the global stage.”

SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals.

“The merger of Vistara and Air India is an important milestone in our journey to make Air India a truly world-class airline,” chairman of Tata, Natarajan Chandrasekaran said.

“We are transforming Air India. As part of the transformation, Air India is focusing on growing both its network and fleet, revamping its customer proposition, enhancing safety, reliability, and on-time performance,” he said.

According to the statement, India is the fastest-growing global economy and is projected to become the third largest in the world by 2027.

It is also the world’s third-largest aviation market.

Demand for air travel is surging with passenger traffic expected to more than double over the next 10 years, supported by rising income levels and ongoing investments in its aviation infrastructure.

However, India also remains underserved with low international seats per capita, signifying significant growth potential, it said.

Following its acquisition by Tata in January 2022, Air India unveiled a wide-ranging transformation programme to strengthen its foundations and revamp its operations, setting it on the road to recovery and positioning it for growth.

Today, Air India - including Air India Express and AirAsia India - and Vistara have a total of 218 widebody and narrowbody aircraft, serving 38 international and 52 domestic destinations.

With the integration, Air India will be the only Indian airline group to operate both full-service and low-cost passenger services, said the statement.

-- BERNAMA