As Air India embarks on a new journey, how will the Tatas pilot it?

Debt-laden Air India has finally found a buyer in Tata Group, which won the bid for the struggling national carrier at Rs 18,000 crore, ending a decade-long struggle for divestment. The transaction is expected to close by the end of December 2021, said Tuhin Kant Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM). He added that the government will get Rs 2,700 crore in cash from the Tatas for sale of its 100% stake.

The airline, founded in 1932, was the pride and joy of J.R.D. Tata, before the then Jawaharlal Nehru-led Congress government took control of Air India in 1953. In an emotional note, Tata Sons Chairman Emeritus Ratan Tata, tweeted, “Welcome back, Air India...While admittedly it will take considerable effort to rebuild Air India, it will hopefully provide a very strong market opportunity to the Tata Group in the aviation industry.”

As Air India looks forward to begin a new chapter under its original founders, let’s take look back at the hey days of Brand Air India, the stature that it commanded among the global aviation industry, the rule of the ‘Maharaja’, the iconic campaigns and more.

The early days

The birth of Air India dates back to the early 1930s, when it had its origins as Tata Air Services, which was later on rebranded as Tata Airline. The first flight of Tata Airlines took off from then Bombay to Trivandrum with a six-seater aircraft. A little later, the airline introduced a flight to Ceylon. During World War 2, the airline helped the Royal Air Force with troop movements, shipping of supplies and rescue of refugees and the maintenance of the aircraft. Immediately post-Independence, the Government of India acquired 49 per cent stake and the airlines was branded as Air India and the first international flight to London from Bombay was started. In 1953, when the airline was nationalised, the Government bought the stake from Tata Sons and the company was renamed as Air India International Ltd, while the domestic services were transferred to as Indian Airlines – thus, there was the birth of two new separate airline brands – Air India for international travel and Indian Airlines for the Indian skies.

The golden years

Post-Independence till the early 1990s, Brand Air India stood tall and powerful in the skies. It was the only airline available to fly both in India and overseas and held a monopoly position for a long time. The brand connected with the Indian audience well by keeping Indian culture alive and maintaining strong Indian values. The brand had a powerful image and presence and at times it was difficult to get a seat as the airline was invariably flying full across all destinations.

The Maharaja mascot created by Bobby Kooka and his team at Air India was so memorable and impactful that people could instantly connect with the airline. Some memorable advertising was created for the brand, which won numerous awards, both in India and overseas, for its originality and subtle humour. The presence of the Maharaja captured everything about Brand Air India, starting from luxury, hospitality, services and about all royalty. The royalty, combined with an emotional touch of Indianness, was what helped the brand to sustain and connect intensely with the audience.

Will the brand enjoy its past equity?

The brand was enjoying great market share till the 1990s, but once the Government opened up the market for private operators, that’s when the brand slowly started to unravel and cracks appeared. Air India is one of the most iconic brands that was built over the years on the back of some great advertising and memorable experiences for Indians, who travelled overseas in the seventies, eighties and nineties. People were very loyal to the airline as there was an emotional connect with it.

Sadly, today the brand has lost its glory as it could not keep pace with the onslaught of nimbler players who offered cheaper fares, albeit minus the luxuries associated with air travel. Compared to the then Air Deccans, Modi Lufts, Kingfisher Airlines and Jet Airways of the world, with their smart marketing strategies, a more glamourous crew and newer aircraft, Air India and Indian Airlines appeared to have a fuddy-duddy image mostly catering to government officials and politicians.

Air travel has changed a lot since the hey days of Air India and India’s oldest operational airlines desperately needs course correction fast. While the Tatas have some experience through their airline brand Vistara, which will help them, but it is the international travel experience that needs go several notches up to match the experience offered by the other international airlines in every sectors.

Reviving the Brand

From the Government’s point of view, it has off loaded a huge white elephant. But their new owners have a Herculean task as they are saddled with a huge debt and there are so many other challenges that the brand has to address to meet world class standards both in India and overseas. Brand Air India still has some equity both in India and abroad. There is a certain section of travellers who still prefer to travel by this airline. Tata’s won’t have to build the brand from scratch and the group has enough professional expertise to steer the airline out of its current status, while at the same time bring in some strong differentiation by retaining some of the core values of the brand. The transformation process and giving a new, distinct and vibrant face to the brand won’t be any easy task.

The Tata Touch

Over a period of time the Tatas have been quite successful when it came to consumer facing brands and they acquired quite a few in the FMCG business. We must also remember that Government and PSUs have rarely been successful in managing consumer facing businesses and we seen it in the telecom sector, too, where BSNL and MTNL are in deep debt and have seen dwindling business in the last few years. HMT was one such brand, which was a household name back in the 70s and 80s, but got displaced by Titan Watches.

The shift of Air-India to the Tatas is definitely the right move that the government has taken. It is now up to the Tatas to give a new lease of life for Air-India and stabilise its heartbeat, which was beating fast for the last many years. While in the case of Nano it did not take off well, but they built Titan Watches from the zero and today that brand has extended to multiple streams of business. Then there is Tanishq, Tata Consultancy Services, and much more.

There is a lot of nostalgia still left around Air India. A lot of mismanagement has resulted in Air India being in the state that it currently finds itself in. All eyes are now on what strategies the Tata Group will draw up to help Air India regain its lost glory. Will the Maharaja win back its lost kingdom? It’s a wait and watch.

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