Air India’s progress: ‘Vistara will remain Vistara until Air India gets to the right level:’ Campbell Wilson | india news

New Delhi: Vistara will be merged with Air India only when Air India reaches “appropriate level”. While progress so far in revitalizing AI is “ahead of schedule”, it is expected that there will be a slight delay in inducting the first of the 470 aircraft ordered this financial year due to issues faced by original equipment manufacturers. Will happen. In an independent interview to TOI, the MD and CEO of AI campbell wilson He spoke candidly about a number of issues, including recent regulatory action on security issues, which he “fully acknowledges” and considers “a reminder that there is work to be done.” Part:

Question. There is apprehension among passengers about the merger of Vistara with Air India as Air India still has a long way to go in terms of overall reform. Will we see a merger by March 2024?

Answer. Vistara will continue to operate as an independent entity, Vistara, until we feel Air India has reached an appropriate level that we can consider a merger. I never said March (2024) is the deadline. Both these airlines will continue to operate separately. The last name of full service airlines is Air India. It will be a task when we reach that point when we feel Air India is ready. We are doing a lot of work to upgrade Air India.
It is useful to obtain competition clearance from Indian authorities. We can start sharing best practices. Vistara can help accelerate this journey. The cultural part will be important. We need to ensure that the AI ​​people accept Vistara’s inputs and we also need to ensure that the Vistara people are excited and enthusiastic about the national mission of revitalizing AI.
The ongoing integration (Vistara-AI and AI Express-AirAsia India) is unprecedented in global aviation – four, rather than five airlines (since predecessors Indian Airlines and Air India were never properly demerged) became two. I don’t think this has happened before and not just for airlines, but for five groups of employees. The future AI Express, which is an integration of the two airlines, will operate as a low-cost airline.

Question. What are the main processes of merger?

Answer. Broadly speaking there are three elements to the regulatory process. One is competition clearance. And CCI India is obviously a component of it, but there are also Singapore and some other jurisdictions that need to be approved.
Then there is NCLT which is the legal approval that allows the transaction to actually close. And then there is the aviation regulatory process (DGCA and BCAS). The process of bringing together the airlines licenses will take place after the legal closure.
And then there’s the third part which is not regulatory. That’s when you really bring the two brands together and operate as one consolidated business. And this is a matter of our conscience.

Question. Delivery of the first of the 470 aircraft ordered is being delayed. Will this affect your plans?

Answer. We are taking ownership of the first Boeing 737 MAX this week. The number of Maxes we will receive by the end of this fiscal year (10-12) is slightly less than our estimate (15) due to a problem at Boeing, which is adding a few weeks to each aircraft.
As for the Airbus A350, we should get six, if not five (as expected) by next March. The first one has been slightly delayed because some additional testing was required on some seats by the seat manufacturer. This calendar year we are definitely expecting an A350 and possibly two.
Although (these delays) are obviously not welcome, it is not the end of the world. Not that everything is being delayed too much, there has been a slight slowdown in the B737 MAX and A350s. We will lease 25 A320s over the next 12 months to grow the AI ​​fleet. These are in addition to the 470 aircraft ordered.

Question. DGCA has suspended AI’s flight safety chief twice in the last four months and the airline has been censured several times by the regulator in recent times. Your comments.

Answer. It is clearly not welcome when practices are publicized that are not followed in their entirety. We have and will continue to invest heavily in improving the overall security culture, be it people, practices, training and the systems being implemented to tighten reporting, monitoring and data tracking. No stone is being left unturned.
But we have to accept (AI) in an organization whose culture is strong in many aspects, not just security. (We’re) changing that culture, getting accountability and changing the understanding of what’s acceptable now versus what might have been acceptable (before). It’s not about ticking boxes, but really understanding the intent and feeling. It takes time. All it will take is a concerted, sustained and long-term effort. Clearly we’re not there yet. And these findings are disappointing, and we fully accept them. This is again a reminder that there is work to be done. We will continue this.

Question. Tata acquired AI and AI Express in late January 2022. Is the revival program on track?

Answer. We had no illusions that this pinnacle of corporate transformation would take time. When we launched our Vihaan (revival) program a year ago, we had said it would take five years. And that the first six months will really be focused on cleanup. Now a lot of work has been done in terms of ordering aircraft, hiring people, acquiring aircraft, increasing flights and setting up systems. So based on that plan, I think we’re a little ahead of schedule. But that doesn’t mean we’ve reached all the aspirations we wanted.
There are some mechanical things that take time. We have committed $400 million to refurbish the planes, which won’t happen until mid-2024. So, a lot of things are going down. This may not manifest physically in front of the consumer, but it is all that is needed to stay a little ahead of expectations.
We have unlocked the supply chain. Suppliers were not giving parts to AI, because AI was not paying. We are settling all those bills. Thousands of parts are now back in the pool. We have a warehouse at Delhi airport because most of our spare parts were in Mumbai while most of our operations were in Delhi.
The company had not recruited for 15 years. Hence there was a lack of exposure to modern practices, modern thinking and succession planning. We have recruited a large number of employees and are building talent across the organization.

Question. So when are you getting profits?

Answer. We are a private company and we have our own internal goals. We are comfortable with where we are at the moment. We will not set any deadline (for making profits). Tata did extensive due diligence and knew how much work and time the investment would take. No one is under any illusion about the enormity of the task and the time it will take. AI has not been a profitable business for many years. And it would be strange if you became a dramatically profitable business overnight. it takes time.

Question. What is the status of the proposed training academy?

Answer. The lease agreement for our new training academy, which will be spread over 6 lakh square feet in Gurugram, has been finalized. It will cater to the training needs of pilots, cabin crew, engineers and staff in airport operations, security, commercial and other areas. There will be a dedicated security center that every current and future Air Indian will have to go through. We are making very good progress with two joint ventures for simulator training. Over the next few years, we will spend more than $200 million.

Question. AI is talking to Lufthansa Technik and KLM for MRO here. What is the progress on the engineering front?

Answer. We are talking to several potential partners for MRO facilities. We had published an invitation to 9 to 10 global players to express interest. We’ve narrowed it down to a few that we want to dive deeper with. It is not necessarily about (bidding for) AI Engineering Services Limited or AIESL (when the government disinvests it). It is a partnership to develop capabilities. AI is needed to support the standard of your fleet and product. And there may be many paths to reach that result. One of which could be ESL.

Question Do you see the Indian aviation market like the Indian telecom market with two major players?

Answer. The Indian aviation market was not healthy for long – with only the frequency of new entrants coming in and then failures. Something was not right. In my assessment, there was a very significant player in Air India which was not really operated for commercial purpose (before 2022). Then you had entrants into the market who were promoter driven and not necessarily well capitalized, always chasing cash flow. And it was not stable and it could not continue.
There are now two significant well-funded professionally oriented players. This can bring some stability and health to the ecosystem. Then there is a profit pool that other people can come in and want to participate in.

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