MUMBAI- Since the Tata Group’s acquisition of Air India (AI), the primary attention has been directed toward Air India, with less focus on Air India Express (IX), its low-cost subsidiary.
Despite its relatively smaller size, Air India Express has maintained profitability. The Tata group’s approach has been to continue operating Air India Express in a “Business As Usual” mode, reported Live Mint.
Air India Express Strategy
Meanwhile, they pursued the acquisition of the remaining stake in AirAsia India, eventually making it a subsidiary of Air India. Additionally, efforts have been made to facilitate the merger of AirAsia India with Air India Express.
AirAsia India was launched with significant excitement in 2014, accompanied by ambitious goals such as achieving break-even within the first year and competing with IndiGo. However, these plans encountered multiple setbacks and controversies, some of which involved the Tata group.
With major aircraft orders in place, the Tata group’s focus has shifted to unveiling the new Air India brand and exploring the merger of Vistara with Air India. Amid these developments, Air India Express has continued its operations, incorporating AirAsia India into its structure.
This process began with the integration of AirAsia India flights into a unified platform, followed by the gradual transfer of planes from AirAsia India to Air India Express.
The airline is also preparing to introduce the Boeing 737 MAX 8 aircraft, with two of them already in India and undergoing the painting process before the official brand reveal.
During this period, the website transitioned to the new branding in the past week. The updated website represented a blend of Air India Express branding on the former AirAsia India website.
The fresh design features a lively orange color scheme, hinting at potential changes in the subsidiary’s visual identity.
Features to Challenge IndiGo Monopoly
In-Flight Offerings
IndiGo (6E) has maintained a consistent approach to its in-flight offerings. Up to this point, the airline refrained from installing ovens on board due to the additional weight and costs involved.
Consequently, whether it’s a corporate traveler or an individual on a short-haul or a longer flight, passengers have had to make do with cold or instant food.
On the other hand, AirAsia India has always provided hot meals and even offered pre-booked meal services as a distinguishing feature.
Air India Express could emerge as a winner if the rebranded airline effectively promotes its food offerings at competitive or more affordable prices compared to IndiGo. IndiGo couldn’t match this offering since it lacks ovens on its planes.
Regarding streaming services, as IndiGo extends its routes with narrowbody aircraft, the availability of charging points and in-flight entertainment becomes a relevant question.
Passengers might find it challenging to sit through longer flights without any entertainment options. If Air India Express implements streaming services across its entire fleet, branded as Airflix, which includes discounts on purchases, in-flight menu options, streaming, and games, it could become a valuable differentiator for the airline.
Loyalty Program
Additionally, in terms of loyalty programs, the Tata group introduced the Tata Neu loyalty app, covering the entire group, with Air India Express being among the early participants.
Although Indian passengers have traditionally prioritized low fares, loyalty cards have gained popularity.
A straightforward and comprehensible loyalty program could be a strategic move to attract passengers, especially considering the current program spans the Tata Group’s various companies.
Bottom Line
While Air India Express may have positioned itself as a differentiator in terms of its service quality, entertainment options, and food offerings, achieving a scale that currently outperforms IndiGo is essential for its success.
Even the best services, entertainment, and food options attract passengers when they have a wide array of choices, including numerous available routes and multiple daily frequencies on those routes.
IndiGo’s upcoming loyalty program, which is no secret, will serve as a competitive response to Air India Express. However, the Air India group’s combined presence on international routes significantly surpasses that of IndiGo.
Despite IndiGo’s efforts to establish multiple codeshare and interline agreements, the advantage of convenient transfers within a single terminal at major airports like Mumbai and Delhi favors the Air India group.
The investments made by the Air India group in adding ovens, loyalty programs, and streaming services should yield returns. Passengers need to be willing to pay extra for the offerings to make these investments profitable. Otherwise, the competition with IndiGo may take a back seat, with the focus shifting toward recouping the investments.
The rivalry between IndiGo and the Air India group is expected to introduce a formidable competitor into the Indian aviation industry. Ultimately, this competition should benefit the passengers, encouraging airlines to enhance their offerings and services.
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