HomeBreakingTata Group's Strategic Evolution of Air India Express

Tata Group’s Strategic Evolution of Air India Express

The Tata Group is nearing the final stages of implementing a comprehensive business restructuring plan for Air India Express. The plan is aimed at achieving greater efficiency and alignment within the airline’s operations. 

According to information provided by three individuals familiar with the matter, the conglomerate is diligently working on unifying the business verticals of Air India Express and AirAsia India.

As one of the insiders shared, 

“The low-cost airline is streamlining its business verticals and bringing in pay parity between the workforce of the two erstwhile airlines.” 

This strategic initiative is a concerted effort to standardize compensation and working conditions for employees across both airline subsidiaries, thereby enhancing operational cohesion and fostering a unified corporate culture.

Organizational restructuring

Air India Express took proactive steps to harmonize its organizational structure by introducing new job grades, compensation packages, and employee benefits. This will introduce greater transparency and fairness in remuneration while simultaneously creating more robust avenues for career advancement for all personnel within the organization.

The airline’s management has emphasized that this fresh approach to pay compensation is closely aligned with the recently implemented structure and grading system at Air India. 

Awaiting final regulatory approvals from the Competition Commission of India, the merged entity is poised for a transformative shift as it embarks on establishing a more streamlined and efficient operational structure.

Under the stewardship of Chief Executive Officer Aloke Singh, the merged entity is actively pursuing the establishment of a more linear organizational framework. It is a strategic move intended to enhance operational clarity and accountability within the airline.

Revamping the compensation framework

In addition to structural changes, they will be revamping the compensation framework, targeting the attraction and retention of top-tier talent across various functional domains within the airline. The impending pay structure is designed to be more market-oriented and competitive, aligning with industry standards to remain competitive in the aviation sector.

The executive elucidated, “The legacy compensation structure of Air India Express is undergoing a substantial overhaul. The rollout of a new compensation structure, harmonizing the salaries of both airlines, is on the horizon and expected to be implemented within the next few weeks.”

Highlighting the need for this overhaul, another executive noted, 

“In certain aspects, Tata’s airline offered more benefits, while the overall compensation for the AirAsia workforce had been comparatively higher. The forthcoming structure is poised to bridge these disparities, introducing a newfound parity across the workforce.”

These transformations in the low-cost airline sector are unfolding shortly after the salary restructuring of the merged entity comprising full-cost carrier Air India and Vistara Airlines.

A fresh brand identity

Following the Tata Group’s unveiling of a new logo and livery for Air India in early August, the conglomerate is diligently working to introduce a fresh brand identity for Air India Express, with the anticipated launch slated for late September to early October. 

The first aircraft featuring the updated branding of Air India Express is set to debut in October, coinciding with the arrival of the airline’s inaugural Boeing 737 MAX aircraft.

AirAsia India secured approval from the civil aviation regulator to operate flights under the Air India Express brand. Subsequently, the airline sought approvals from the Directorate General of Civil Aviation to expedite the integration of both airlines. 

This integration includes the crucial rebranding process, transitioning from AirAsia India to Air India Express. This transition will enable Air India Express and AIX Connect to operate under a unified ‘Air India Express’ brand, paving the way for seamless alignment ahead of the legal merger of the two entities.

Presently, Air India Express operates flights connecting 20 Indian cities to 14 regional international destinations, while AirAsia India primarily serves 19 domestic destinations.

Notably, Air India Express, bolstered by its existing fleet of 26 Boeing 737 aircraft and 28 Airbus aircraft from AirAsia India, is poised to further expand its capabilities with the addition of 23 new Boeing 737 MAX aircraft by the end of March. 

These aircraft are part of a broader order placed by Air India for a total of 470 planes in February, which includes a significant portion dedicated to the Boeing 737 Max variant. Approximately 50 aircraft from this order are expected to be integrated into Air India Express’s fleet soon, as they were initially earmarked for Chinese airlines. 

However, due to the pandemic’s lingering impact on travel demand, these aircraft are now set to join the ranks of Air India Express, further enhancing its operational capacity.

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Snigdha Basu
Snigdha Basu
A multifaceted writer, Snigdha Basu is a freelancer and a columnist at Entrepreneurs Today. She also spearheads Chic Life Edition - her own Digital Magazine with sustainable fashion, beauty, and culture at its core. Reach out to Snigdha at [email protected] for inquiries.
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