GURUGRAM- Tata-owned Air India (AI) has started transferring some of its Airbus A320 aircraft to sister carrier, Air India Express (IX) in short AIX this week.
Earlier this month, Air India Express announced that it had successfully concluded the merger of AI Express and AIX Connect (formerly known as AirAsia India). The Gurugram-based carrier is also set to merge Vistara (UK) inside Air India Group next month.
Air India A320 Transfer to AIX
These planes that Air India is transferring to AIX have all-economy seats. Also, these aircraft are very old and have been operating for Air India since 2010.
The low-cost carrier now operates five A320ceo planes in an all-economy configuration, accommodating 180 passengers per aircraft. This layout mirrors that of former AirAsia India planes, which predominantly featured 180-seat A320ceo aircraft, Mint reported.
Vistara, another airline within the Air India group, has contributed 10 aircraft with identical 180-seat, all-economy configurations. This fleet expansion follows past collaborations where Air India and Vistara operated flights for Air India Express during operational challenges caused by software issues and employee unrest.
Recent months have seen significant changes within the airline group. Routes have been transferred between carriers, while ground services, engineering, and codeshare agreements have been streamlined to enhance inter-airline connectivity and passenger transfers.
The transfer of aircraft to Air India Express signals a clear strategy to challenge IndiGo’s dominance in the domestic market. Air India Express has recently announced new routes and increased frequencies between existing destinations, often competing directly with IndiGo’s monopoly on certain routes.
The exact number of aircraft to be transferred from Air India and Vistara to Air India Express remains uncertain. Vistara initiated the process by moving two Boeing 737-800 aircraft to Air India Express. This reallocation, however, will reduce the capacity of the group’s full-service operations, which will merge into a single entity after November 12.
Diversified Fleet
Industry analysts expect the full-service arm to refocus its strategy on high-yield metro-to-metro routes and sectors that feed long-haul flights. Additionally, narrowbody aircraft are likely to be deployed on short-haul international routes to support the group’s international hub operations.
Air India has already launched flights to Phuket, Ho Chi Minh City, and Kuala Lumpur, with rumors suggesting further expansion into ASEAN markets in the coming months.
Air India’s 2023 aircraft orders, including both A320 family and MAX 8 planes, initially suggested Air India Express would expand primarily with MAX 8s. However, the airline’s fleet strategy has evolved, incorporating both aircraft types to accommodate pilots from the former AirAsia India, an all-Airbus A320 operator.
This fleet diversification presents both advantages and challenges for Air India Express. The airline now operates a mixed fleet of 737-800, MAX 8, A320ceo, and A320neo aircraft, with MAX 8s in various configurations. This approach prioritizes immediate market capacity over a uniform fleet, addressing current supply chain constraints.
The aircraft transfer process involves complex paperwork, requiring coordination among lessors, regulators, airports, and financiers. This carefully planned move aims to avoid disruptions and ensure smooth transitions.
Competing with IndiGo
IndiGo (6E), Air India Express’s main competitor, faces a new challenge. Unlike previous financially weaker rivals, Air India Express poses a significant threat. IndiGo’s upcoming loyalty program launch may aim to retain customers on routes where Air India Express is expanding.
The competition now hinges on operational factors. IndiGo’s historically strong on-time performance has recently declined, opening an opportunity for Air India Express. The low-cost carrier can leverage the Air India group’s loyalty program to attract passengers seeking alternatives.
Air India Express’s cost advantage over its parent company adds another dimension to this strategic shift. However, managing a diverse fleet efficiently will be crucial for maintaining this edge.
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