The Air India Turnaround Challenge for the Tata group
The Tata Group is facing its toughest challenge yet with Air India. After a recent crash that killed 260 people, turning it around will be one of the most complex tasks in Indian business history. The crash also ruptured the Tata Group’s carefully managed narrative of the airline’s revival.
Tata Sons’ chairman N Chandrasekaran has acknowledged the crash is a “grave setback” for Air India’s comeback narrative. As a stakeholder puts it, corporate turnarounds are hard; airline turnarounds are more complex, and recovering from a high-profile disaster is the hardest. The Tata Group, which owns Air India, has been trying to put its house in order.
Tata Sons and its joint venture partner, Singapore Airlines, have poured in fresh capital totalling Rs. 9,558 crore in FY25 alone, with Rs. 6,333 crore coming in from the foreign airline. This represents the largest single-year capital infusion in the history of Indian aviation. Singapore Airlines owns a 25.1% stake in Air India.
Some believe that Tata Sons is offering steep salaries to the top management for too little work on the ground. Air India management, however, wants stakeholders to believe that the leadership will do whatever it takes to regain passenger confidence. A spokesperson says transforming a 93-year-old organisation is a complex, long-term endeavour. “Over the last three years, some significant organisational changes were introduced to bring professionalism and accountability. This is an ongoing journey,” says the spokesperson.
