Air India expects $1.6B loss after deadly Ahmedabad crash
What's the story
Air India, a joint venture between Tata Group and Singapore Airlines, is expected to report a record annual loss of at least ₹150 billion ($1.6 billion) for the fiscal year ending March 31. The financial setback comes after last year's fatal crash and airspace shutdowns hampered its turnaround efforts. The airline's earnings were also impacted by Pakistan's closure of its airspace to Indian airlines following a military clash with India.
Profitability setback
Air India's profitability targets derailed by crash
The Boeing Dreamliner crash in Ahmedabad in June, which claimed 260 lives, has undone years of progress for Air India. 241 out of 242 onboard dies while 19 people were killed when the plane crashed into the B.J. Medical College hostel shortly after takeoff. The airline had aimed for operational break-even this fiscal year, but now profitability seems out of reach. The losses come amid a turbulent year for Indian aviation, characterized by flier anxiety, flight delays, and mass cancellations.
Strategic rejection
Air India's new 5-year plan rejected by board
Air India's management had submitted a new five-year plan, forecasting profits only in its third year. However, the board rejected this proposal and demanded a more aggressive turnaround strategy. Government filings show that Air India has lost ₹322.1 billion over the last three years, with the airline seeking at least ₹100 billion in fresh support last year.
Leadership search
Tata Group seeks new CEO amid mounting losses
The rising losses have raised concerns for both owners of Air India. Tata Group has started looking for a new Chief Executive Officer to replace Campbell Wilson, though the search may not be completed until after the crash report is released. Singapore Airlines, which acquired a 25.1% stake after merging Vistara with Air India in 2024, has also seen its earnings affected by the carrier's performance.