The CEO of Vistara on Tuesday tried to allay employee worries about their futures following the airline’s proposed merger with Air India.
Vinod Kannan assured staff members in an email announcing the merger that the efforts they had made to build the airline had “not gone unnoticed” by its shareholders. He also advised them not to worry or speculate about their future.
Next week, Kannan will also host a town hall meeting with the staff.
The merger of Air India and Vistara was announced on Tuesday by Tata Sons and Singapore Airlines (SIA). The Vistara brand will be dropped, and SIA will own a 25.1% stake in the combined company with an equity investment of Rs 2,058.50 crore.
Effect on employees
Executives at Vistara are concerned about the decision because they don’t know what their position will be in the combined company. Industry insiders claim that many Vistara employees have already started looking for work elsewhere as a result of the uncertainty.
“In a short period of time, Vistara has been built and established as the award-winning airline of choice in India thanks to the hard work and dedication of all of us. On the operational, financial, and human fronts, this has produced notable results that we are all aware of.
The shareholders have taken notice of this, according to Kannan’s letter to the staff.
Since January 2022, Vistara has been led by Kannan, a nominee of Singapore Airlines. It is customary for SIA executives to take the position of CEO of Vistara under the terms of the joint venture between Tata Sons and SIA. With a 10% market share for the first time since its founding nine years ago, Vistara this year overtook Jet Airways as the second-largest airline in India.
"There will undoubtedly be a variety of chances for development, advancement, and growth. I therefore implore you to refrain from worrying and making predictions about the future. Regardless of the AOC (air operator certificate) we adhere to, we continue to be an essential part of the aviation footprint of our shareholders, he wrote.
An employee of Vistara compared it to years of labour going to waste. “You don’t know which team you’ll be on or what level of authority or decision-making you’ll have. Personally, I find nothing joyous about this announcement,” the person said.
Since being purchased by the Tata Group from the government, Air India has aggressively recruited for numerous senior positions.
Additionally, this has worried senior Vistara executives. What roles are Vistara veterans going to play at Air India if it already has a commercial head, an operations head, and a sales head?
Bhaskar Bhatt, chairman of Vistara and a seasoned member of Tata Sons, has addressed Vistara employees in a number of town hall meetings to allay their fears.
In order to more quickly achieve the size, reach, and quality befitting a world-class airline, the new Air India will be able to leverage the skills, people, systems, and processes that had driven Vistara’s success, according to Air India CEO Campbell Wilson.
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