DELHI- Air India is preparing to review its staff travel rules and other cost-saving proposals as the Tata Group-owned carrier strengthens its focus on financial discipline.
The airline’s board is expected to consider the measures at a meeting scheduled for October 15, with stricter approval criteria for official employee travel among the proposals under discussion.
The review comes as Air India (AI) seeks to control expenses while improving efficiency across its operations.
The airline is also examining broader changes across the Air India Group, including closer coordination with Air India Express (IX), as the group faces substantial financial losses and looks for ways to reduce duplication.
Air India Staff Travel Policy Review
The proposed review centres on the staff on duty (SoD) policy, which governs employee travel for official assignments. Under the proposed changes, Air India would introduce stricter guidelines to assess whether each journey is necessary before approving business travel.
The initiative forms part of the company’s developing cost-conscious culture, according to people familiar with the proposals. However, the measures remain under consideration, and the board has not yet made a final decision.
Air India had already revised its employee travel arrangements from April 1, 2025, requiring staff, including senior management, to travel in economy class.
Employees could receive upgrades to premium economy or business class only when seats remained unsold 50 minutes before departure, ensuring that paying passengers received priority.
The latest proposal could further strengthen controls over official travel spending.
Air India did not respond to emailed questions about the planned review, while a senior airline official confirmed that the board was expected to examine some proposals under the company’s cost-awareness programme.
Air India Department Restructuring
The board is also expected to consider a proposal concerning the airline’s information technology (IT) department, which currently operates from Kochi.
Sources indicated that Air India was evaluating a possible relocation of the department’s campus to Delhi, alongside potential changes to staffing and departmental structures.
However, the plans have not been finalised, and the airline’s position on departmental restructuring remains disputed.
While sources described possible rightsizing and relocation proposals, a senior Air India official dismissed the possibility of reducing staff or shifting the location of any department.
These proposals form part of a wider effort to improve the use of resources across the airline group. Any decision on departmental changes will depend on the company’s internal review and the board’s consideration.
Air India Group Cost Savings
Air India and Air India Express are also examining the integration of selected departments to reduce duplicated work and improve operational efficiency.
The discussions reportedly cover functions such as human resources and finance, while marketing has already been integrated under the group’s commercial operations.
The airlines also share leadership across network planning, sales and distribution, and revenue management. If approved, the proposed functional integration could take around six months to implement, while both carriers would retain their separate brands and business models.
Unlike the earlier mergers involving Vistara in 2024 and Indian Airlines in 2007, the current proposal focuses on selected departments rather than a complete merger.
Air India would continue operating as a full-service carrier, while Air India Express would retain its low-cost model.
The financial pressure behind these measures remains significant. In FY2026, Air India and Air India Express, together with their joint ventures and subsidiaries, reported combined losses of ₹22,238 crore against revenue of approximately ₹71,870 crore.
On a standalone basis, Air India recorded a net loss of ₹15,368 crore, while Air India Express reported a net loss of ₹6,767 crore, The Hindu Business Line reported
The proposed reviews follow calls for closer coordination across the group, with management emphasising efficiency, cost control and customer service while preserving the distinct identities of both airlines.
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