By Jitender Bhargava
Air India, the country’s most iconic and cherished global brand till some decades ago, is back with the Tatas following the transfer of ownership on 27 January, 2022. This ownership change will indubitably go down in the annals of Indian civil aviation as amongst the most momentous and historic events.
What made the occasion even more epoch-making for the Tatas, who described the acquisition of Air India through the two-year-long disinvestment exercise as “homecoming” was the fact that It was almost seven decades ago that the government had acquired control of Air India through nationalisation in 1953, much against the wishes of J R D Tata, who had single-handedly pioneered the airline since 1932.
Touted as the biggest and the most onerous disinvestment exercise undertaken by the Indian government since our political system appeared averse to its sale, it eventually turned out to be a smooth transition, welcomed by all stakeholders – the government, as the divesting entity; Tatas as the new acquirer, and the employees.
Emotional Connect
There were, in fact, two key factors that helped Air India disinvestment in not evoking the kind of opposition one had expected. First, the huge emotional connection that the people had with Air India. One was amazed that even though the airline’s performance had been lacklustre in recent years; Air India had an unmanageable debt and cumulative losses running into thousands of crore on its balance sheet besides having become an almost marginal player – the emotional bond with a large cross-section of Indians had remained intact.
Everyone, irrespective of whether they were patronising the airline by flying or not, had wanted the airline to be revived, and regain the glory of yesteryears. This made it distinct from the feeling that the collapse of Kingfisher (2012) and Jet Airways (2019) had aroused. There appeared to be absolute unanimity in not only recognising the harsh reality that revival was an impossibility under govt ownership people also did not want Air India to fly into oblivion because the airline’s history, until a couple of decades ago, had virtually been the history of Indian civil aviation.
The yeomen service it had performed over the years by evacuating stranded Indian nationals, flying relief material to different parts of the country and abroad in extraordinary circumstances besides connecting India with the world and most Indians having undertaken their first flight on Air India – all contributed to the immense goodwill for the airline.
One may not have realised the extent of goodwill that Air India commanded in normal circumstances but it became starkly evident when the government finally transferred control of the airline to the Tatas on 27 January, 2022. Not only were the naysayers to disinvestment on various specious grounds shocked at the ease with which the ownership transfer took place but there was jubilation all around.
Faith In Tatas
Another significant reason for the successful culmination of the disinvestment exercise was the faith that people had in the industry conglomerate Tata’s ability to transform the airline. A contributory factor, of course, being the fact that Tatas had originally created Air India and had successfully made it into a global brand. There were also some who believed that the government by handing over control of Air India, albeit through disinvestment, had only corrected a wrong done in 1953 when the airline with a promising future was taken away from the Tatas through nationalisation.
Even though it may be an exercise in futility one shudders to think whether the process of ownership transfer would have been as smooth as we witnessed if the acquiring entity was any other company than the Tatas?
Much of the emotional feelings attached to Air India and faith in Tatas to transform the airline also happened to form an integral part of the messages that emanated from the Tatas on the occasion.
In a message addressed to Air India employees, N Chandrashekhar, Chairman, Tata Sons, said: “From the day of the announcement, one word has been on everyone’s lips: homecoming. We are proud to welcome Air India back into our Tata family, after all these years. I, like many others, have enjoyed reflecting on stories from the airline’s brilliant past.”
New Chapter
The message also had several undertones to make Air India employees, having worked in a sarkari environment for long, understand the values of the Tata group. It said: “A brand new chapter unfolds for Air India as part of the Tata Group. Two iconic names have come together to embark on a voyage of excellence. Looking forward to soaring high propelled by our rich legacy and a shared mission to serve our nation.”
Realising the challenges that lay ahead for transforming Air India as a world-class airline, Tatas, while recalling the glorious past of the airline when JRD Tata helmed the airline, exhorted: “Such memories are wonderful, but now is the time to look ahead. Today is the beginning of a new chapter. The entire nation’s eyes are on us, waiting to see what we will achieve together. To build the airline our country needs, we need to look to the future.”
Likewise, perhaps realising the opposition of unions/employees to changes in work practises that led to fall in service standards, the message said: “Our Group has its own storied past. I have learned that to preserve what is best about the past, requires constant change. It is by evolving, adapting and embracing the future that we best honour a glorious history. I am convinced that the golden age of Air India lies ahead. Our journey towards it starts now.“
In an oblique reference to Air India’s steady downfall from its once-iconic status and air travellers enhanced high expectations following Tata’s acquisition of Air India, the advertisement ‘Amazing before, Amazing again’ released by Tatas had a word of assurance: “We heard what you’ve been saying, and we look forward to giving you what you’ve asked for. Today, we’re making a commitment to our future. We have been the wings of a nation. Now we will also be the wings for its future.”
Everyone’s A Gainer
There are few business transactions in which everyone emerges a winner. Air India disinvestment is one such. Air India employees; Air India, the airline; Tatas, as the new owner; Govt, as the old owner; the passengers, India, as a nation; are all set to gain. One only wishes it had happened earlier because the delay has seen the airline marginalised, public perception of the airline dipping in the eyes of the people and the country having had to face a huge financial burden to keep the airline flying.
Additionally, the inability of cash-starved Air India to expand its global footprint to match the growth in India originating traffic in recent years had led to several airlines from the Middle East – Emirates, Qatar, Etihad to name a few and South East Asia – Singapore Airlines, Cathay Pacific, Malaysia Airlines making inroads into the Indian market. With the acquisition of Air India by the Tatas and funds unlikely to be a constraint, it is expected that Tatas will recapture the lost market in the coming years.
Considering that Air India is a known brand internationally and air travellers have enormous faith in Tata’s ability to transform Air India into an airline of choice, one can expect numerous passengers hitherto not looking at Air India as an option for travel to do so. It isn’t just the faith in Tatas but also the excitement that surrounds the disinvestment that is spurring optimism. The nostalgia around Air India, recapitulation of Air India’s glorious past when it mentored several airlines, like Singapore Airlines, and Air India recovering lost ground, one can expect better days for the Indian aviation industry in the years to come.
Air India, when led by J R D Tata, was a dream airline – a reality! Air India, now owned by Tatas, will become a great airline again – a hope of a billion Indians!
Jitender Bhargava, Former executive director, Air India & author of The Descent of Air India.