The aviation sector in India is moving towards consolidation and stability. As profitability grows, the country will “certainly” see more than two major airlines in the “near future,” said Campbell Wilson, CEO and Managing Director of Air India, on Thursday.
Currently, Air India, operated by the Tata Group, and IndiGo together control over 90% of the domestic passenger market.
The Air India group, which operates around 300 aircraft, plans to expand its fleet to approximately 400 planes by 2027, Wilson shared during his first press conference following Vistara’s merger into Air India on November 11.
According to Wilson, growth in 2025 will focus mainly on domestic and short-haul international routes. This is because widebody planes will start undergoing retrofitting from the first half of next year, temporarily reducing their availability.
In 2025, there will be a minor decline in the quantity of widebody aircraft available for deployment. By 2027, though, the retrofitting work will be over,” he continued.
The retrofitting of Air India’s widebody aircraft was delayed due to global supply-chain challenges.
Starting next month, Vistara’s narrow-body aircraft and Air India’s retrofitted narrow-body planes will operate on metro-to-metro routes. Retrofitting of Air India’s narrow-body fleet, which began in September, is expected to finish by mid-2025, Wilson noted.
Air India controls 60% of the domestic market, he noted, including 55% on metro-to-metro routes and 40% on the top 120 routes.
Addressing the “duopoly” in Indian aviation, Wilson explained that this phase is temporary and is part of a global trend in aviation markets.
A lack of profitability caused airlines to launch, fail, and exit in many parts of the world, causing the aviation markets to become fragmented. Consolidation brings stability, professionalism, and profitability, which eventually attracts new players,” he said.
Wilson pointed out that under government ownership, Air India had been unprofitable for a long time, negatively impacting the Indian aviation ecosystem.
“It disrupted the ecosystem’s profitability, causing turmoil as airlines entered the market, incurred losses, and struggled to withstand market fluctuations,” he remarked.
When asked about Air India’s timeline for profitability, Wilson declined to provide specifics, stating, “We have internal targets, but we don’t discuss them publicly.”
Regarding Singapore Airlines’ 25.1% stake in Air India after the merger, Wilson emphasized that the majority of passengers are Indian nationals, making the airline’s identity firmly Indian. “The financial stake by another entity is almost irrelevant,” he said.
Amid concerns about human resources post-merger, including issues of seniority and retirement age, Wilson assured that the expanded organization offers significant opportunities for employees and reiterated Air India’s commitment to being a “responsible employer.”