New Air India Merging Towards Star Alliance

India being the second most populated country in the world once had two big state owned airlines: Air India and Indian Airlines. The merger of the two airlines was approved by Indian state authorities earlier this year at the end of August, when the Ministry of Corporate Affairs issued its final approval to the application, thus establishing the new National Aviation Co. of India Ltd. that will fly under the Air India name.

Air India Logo

The merger of Air India and Indian will provide an integrated international and domestic footprint, which will significantly enhance customer proposition and allow easy entry into a global airline alliance,” the government said. “The merged airline has given them the opportunity to unlock significant synergies on account of optimal utilization of resources through improvement in load factors and yields on commonly serviced routes as well as deployment of ‘freed up’ aircraft capacity on alternate routes.

The merged carrier will operate a fleet of 112 aircraft, including seven new 777s, 10 A320 family aircraft and four 737-800s introduced this year. The parent company will comprise the mainline (Air India), an LCC called Air India Express, Air India Cargo (which is in the process of acquiring 737 and A310 converted freighters and plans to be operating 10 aircraft within the next year), and ground handling and MRO divisions that will “gain increased focus on the merged entity,” the government said. Each will be managed as a separate unit.

Only one week after the approval of the merger, the new Air India’s board voted to join Star Alliance, according to the United News of India news service and The Economic Times. A formal announcement about Air India’s entry into Star Alliance is expected in December 2007, highly-placed Indian civil aviation ministry sources said – according to The Economic Times. The agreement would come into effect early next year, enabling Air India to provide seamless connectivity to its passengers across the networks of all Star Alliance partner airlines. However, no other details were revealed, and neither the airline nor the alliance issued a statement.

With most of the European, American and Far-Eastern carriers being already enrolled in an alliance the markets left without proper alliance coverage include China, India, Russia, the Middle-East and Africa. India will now be Star Alliance territory, while they will soon have two members in Africa (South-African Airways and Egyptair as AirlineWorld reported yesterday) and also two Chinese carriers are bound to join Star in the mid-term. SkyTeam currently seems strong in Russia and also has a Chinese candidate, while oneworld has Dragonair operating in China as an associated member, but on the other hand has the only Middle-East airline alliance member: Royal Jordanian. It will be interesting to see where the big Russian carriers, the big Chinese carriers and the rest of the African and Gulf Region carriers will join in.

by balint01


5 Responses to “New Air India Merging Towards Star Alliance”

  1. 1 balint01 October 22, 2007 at 12:52 pm

    Air India Chairman V. Thulasidas said on 19OCT2007 that the carrier remains in negotiations with Star Alliance but has not reached a final decision to join, The Economic Times reported. “We can announce our alliance only after a formal agreement is reached,” he told the paper.

    (ATW News)

  2. 2 sanjeev August 21, 2008 at 9:37 am

    This merger is to join two public sector airlines together and kill them together.

    If the idea of bringing in these carriers was to benifit the passengers then one could understand it but to do it ones own gain which our honourable minister is doing.
    These guys have shares in all the ground handling agencies that will be taking over the check in and ground handling facilities at major airports.They have shares in jet airlines and travel with them all the time.
    Any sector that Air India is doing well on is withdrawn(the latest example being the delhi lax delhi sector which will be withdrawn from this month end and give to kingfisher or jet.
    jet is the prefered one as the day when they start any flight air india”s flights start getting cancelled or delayed.There have been circulars in both the airlines to transfer passengers first to jet and then to any other airlines.This is a conspiracy at the highest level.The poor passengers are suffering on a regular basis.The public sector national carriers are given the last choice of landing,the worst gates at the airport,their passengers treated shabbily by every agency.
    Upgradings are done to benifit the contacts of the ministries so how can the airline run in profit!! these guys are using the public sector airlines as their wh***s !
    The managers of air india on foreign postings save a minimum of 30 lacs in three years and upto a crore in postings.Air India and Indian airlines after merger have 60 executive directors with everyone using their influence to become a director.This is merger for you.Relatives of influential people are appointed directly as senior manager after doing mba from and nondescript institutes.Then we expect this airline to run in profit!

    The pilots are paid a huge sum and are the real maharajas of the airlines.
    All this merger is nonsense!
    Then the public sector airlines are blamed.These are the ones who taught singapore airlines and many major airlines how to do their job.

    I say remove these guys above the level of senior managers.get guys from the best institutes.Stop upgradings.Give these airlines a level playing ground,give the front line staff members a sense of pride in their airline,designer uniforms,coordinated backup and then see them perform.If they still dont do well hang them!

  3. 3 balint01 August 21, 2008 at 11:30 am

    Thanks for your detailed comment Sanjeev, we have marked your words.

    If this is all true, it’s a very sad story… We’ll see over time!

  4. 4 sanjeev August 29, 2008 at 2:36 pm

    My allegations have been further proven.
    AirIndia was to buy simulators and had booked but under pressure of the ministry they were given to jet airways and now whenever air india needs to train its pilots for its 777 airctaft they pay jet a huge amount.

    Also air india losangeles flight is now doing very well to the dislike of the minsitry and they have decided to stop it and give sanfrancisco sector to kingfisher.
    Talk about big money involved.
    air India is leaving its early morning 645 am slot with an arrival of 1130 in london and will be operating at 2am in the morning.
    This is further proof for you.

  1. 1 Air India In Talks About Airbus A380 « Airline world Trackback on October 31, 2007 at 10:44 pm

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