Air India Considers Merger with Air India Express to Cut Costs
What Happened
Incoming Air India CEO Tewolde Gebremariam is reportedly exploring a merger of the full-service carrier with budget subsidiary Air India Express. According to a report, he has questioned the need for two separate airline entities and believes combining them could reduce regulatory expenses and eliminate duplication across management, engineering and administrative functions. The proposal is still at an early stage and would require board approval. Air India Express would likely retain its brand if the merger proceeds. Meanwhile, Air India posted a loss of about ₹22,238 crore (around $2.3 billion) in FY26.
Key Takeaways
The potential merger signals an aggressive push by Tewolde Gebremariam to improve efficiency and reduce costs as Air India battles record losses, rising fuel expenses and operational challenges. If implemented, it would mark another major restructuring move for the Tata-owned airline as it continues its long-term turnaround strategy.