News
Tata increases AirAsia India stake to 49%, Air India’s B787 troubles continue
April 1st 2016
India’s Tata Group conglomerate on Wednesday formally announced plans to increase its stake in AirAsia India from the current 41.06% to 49%. It is seeking Telestra’s 7.94% shareholding in the LCC. Read More » Telestra is owned by well-known Indian businessman Arun Bhatia, who previously said he was not interested in continuing his investment in AirAsia India, citing consistent losses since inception in 2013 and an acrimonious relationship with AirAsia Group (which continues holding 49%).
The Chennai-based carrier saw a management change in March, with Amar Abrol replacing Mittu Chandilya as CEO. It is understood that Chandilya and other stakeholders in AirAsia India had major disagreements. The carrier also announced the appointment of former Air France-KLM executive, Ankur Khanna as CFO, and Kiran Jain as its head of commercial operations.
Tata Group also holds 51% in Gurgaon-headquartered Vistara, with Singapore Airlines holding the remainder.
Tata on Tuesday once again urged the government to abolish the punitive 5/20 rule. This is met with fierce opposition from older Indian airlines, including Air India, Jet Airways, IndiGo, GoAir and SpiceJet. “People who say look at the recent past, this is unfair. We could also say look at the distant past, which is even more unfair. We are the pioneers and we have to fight it out,” said Mukund Rajan, group executive council and brand custodian of Tata Sons, on the sidelines of the launch of Vistara’s first lounge in Delhi.
“We don’t need a certificate from anybody to tell us whether we have a right to belong here or not. If anyone has a right to be in aviation, it’s the Tatas,” said Rajan. Air India, the country’s oldest airline, was started by Tata Group’s J.R.D. Tata in 1932 as Tata Airlines. The government took over after World War II in 1946.
Chairman emeritus of Tata Sons, Ratan Tata, went public last month terming the lobbying against abolishing the 5/20 rule as “sad”.
Meanwhile, Jet Airways last week shifted its European hub from Brussels Airport to Amsterdam Schiphol Airport, with daily A330-300 flights to Delhi, Mumbai and Toronto. "Today marks the start of our new service connecting three continents, together with our codeshare partners KLM and Delta Air Lines," Jet Airways chairman, Naresh Goyal, said.
In Delhi, flag carrier Air India’s B787 Dreamliner woes continue. On Tuesday, a Hong Kong-Delhi service landed in Kolkata after encountering engine problems inflight. The plane was later declared unfit to continue the journey. The previous week a B787 was grounded in Paris because of “technical issues”, and the week before that a Delhi-Kolkata B787 domestic flight was cancelled after the frame was declared un-airworthy. Air India’s engineers have long protested and shamed the Dreamliner. "The association is requesting management to put further deliveries B787 on hold until all technical problems are resolved. Boeing should also extend the warranty from four years currently to six years," the engineers association has said previously. Air India currently has 21 B787s, with six more on order through to 2018.
Across the border, in Bangladesh, Regent Airways has taken delivery of its first B737-800. The ex-Shenzhen Airlines frame joins the two B737-700s and two Dash 8-300s already in its fleet serving Muscat, Bangkok, Kuala Lumpur, Kolkata and Singapore, as well as Chittagong and Cox’s Bazaar locally.
