The Maharaja’s downfall – The many lessons from Brand Air India

With the latest disinvestment move by the Indian Government, Air India is up for sale – yet again. This time, the Government is inviting bids for 100 per cent stake sale in the national carrier. It may be recalled that in 2018, too, the Government had sought to sell Air India, but found no takers in the loss making airline.

While the industry is hoping for rejuvenation for Air India post the disinvestment, it seems like an inglorious end of sorts for the airline. However, amid the heavy losses, it is this national airline that the Government is turning to – yet again – as it gears up to evacuate Indians stranded in a Coronavirus hit Wuhan in China.

This brings back memories of the massive evacuation of Indians from Kuwait and Iraq in 1990 s Saddam Hussein’s forces invaded the oil-rich nation. Guinness World Record recognises that event as the biggest evacuation of civilians by air in the history of mankind. At that time, Air India operated 488 flights over two months flying out around 1.2 lakh passengers. The Akshay Kumar-starrer ‘Airlift’ documents the memorable events and evacuation story.

It’s time to 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 1930’s 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 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 1990’s, 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 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.

The brand was enjoying great market share till the 1990’s, but once the Government opened up the market for the private operators, that’s when the brand slowly started to unravel and cracks appeared.

Speaking about brand Air India, Business Strategist Lloyd Mathias said, “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.” 

Furthermore, adding about its downfall, Mathias said, “Sadly, the brand has lost a lot of its sheen in the past two decades and has barely been able to keep pace with the onslaught from the newer entrants in the private sector and the general opening up of the aviation space.” 


Sharing his views, Manish Porwal, Managing Director, Alchemist Marketing and Talent Solutions, said, “From a consumer’s perspective, Air India is still pretty good while you see other airlines cut cost left, right and centre. Having said that, Air India customers are aging and the newer generation might not want to even try the airline just for the brand.”

Beginning of the downfall

The opening up of the skies permitted many private operators to start their operations, especially low cost airlines such as the now defunct Air Deccan. There were at least 4 to 5 airline brands who aggressively marketed their services. Most of these airlines initially launched their airlines as fully loaded services, but later on moved to the budget space with no frills attached. With competitive pricing and aggressive promotions, the travellers got a new choice and option to travel and this resulted in the loss of market share and Indian Airlines steadily started losing ground.

There were a few private operators who also exited, but new players joined the bandwagon and the competition became intense for Air India to combat with the new players. As the market share started slipping and losses began accumulating, the Government had to bring in some tight measures to cut costs and reduce losses. One such move was the merger of Indian Airlines and Air India. However, even after this merger the survival of the airline was a big question mark. Finally, the Government made a firm move to sell off the airline in 2017. But there were no takers and no private companies came forward. One of the primary reasons for the lack of interest was the colossal debt that Air India has been burdened with.

A new lease of life

From the Government’s point of view, it was very clear that it would like to off-load this huge white elephant. The first expression of interest did not see light of the day as it did not excite the private buyer saddled with such a huge debt. To make this sale happen, the Government had no choice but to further sweeten the offer by absorbing 2/3rd of its debt. The revised debt figure now reads Rs 23,286 crore from Rs 62,000 crore. Besides that, the liabilities will be adjusted to ensure that there are assets against them. While the bid will be for 100 per cent stake, about 3 per cent will be given as ESOPs by the new owners. According to industry sources, the Government has mandated that the new owners will continue to use the brand name Air India and cannot change the name after purchase. Of course, one will not know what will happen to the iconic mascot Maharaja.

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. The brand has been in existence for over 60 years, so one need not have to build the brand from scratch. The new owner/s should have that core expertise to shoulder this brand and ensure that it is given a fresh outlook to fight competition with some strong differentiation. Will it again go into the original parent, the Tatas, is anybody’s guess. Till fresh developments, it is a wait and watch.


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