India’s low-cost carrier (LCC) market is set for a major transformation with the Tata Group finalizing the merger of AirAsia India into Air India Express on October 1, 2024. This consolidation will create a mega entity under the Air India Express brand, with a combined workforce of 7,000 employees. Currently operating 84 aircraft—primarily Boeing 737s and a few Airbus 320s—the airline plans to increase its fleet to 100 by the end of the year.
AirAsia India, Tata Group’s initial re-entry into aviation, began operations in June 2024. However, from October 1, the AirAsia designator code 15 will no longer exist. Meanwhile, Tata’s joint venture with Singapore Airlines, Vistara, will merge into Air India on November 12, further consolidating the group’s airline portfolio.
As the fastest-growing aviation market globally, India’s LCC sector is expected to expand rapidly in the coming years. While IndiGo remains the dominant player with a fleet of 340 aircraft, industry experts do not view the emergence of other LCCs, such as Air India Express, as direct competition. “The market is large enough for multiple players, giving consumers more choices,” said an industry observer. “IndiGo will need to focus on improving its onboard experience, while Air India Express must prioritize expanding its network and increasing flight frequencies.”
To differentiate itself, Air India Express plans to offer hot meals onboard and maintain a more informal brand image, appealing to modern travelers. Onboard meals remain a competitive advantage over IndiGo, whose current fleet is set to double by the end of the decade, with 1,000 aircraft on order.
The Tata Group’s ambitious plans include a $470 billion order for 400 narrow-body and 70 wide-body aircraft. Of these, a significant portion of the 190 Boeing 737 MAX and 210 Airbus A320 family planes are expected to be assigned to Air India Express. The airline has already received 33 “whitetail” B737 MAX jets and expects 17 more by year-end, bringing its fleet to 100 planes.
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