Merger with AIX Connect will drive long-term sustainable profitability: Air India Express MD
AIX Connect, which merged into Air India Express in October, reduced its net loss significantly to Rs 1,149 crore in FY24, down from Rs 2,750 crore in FY23, reflecting early benefits of the integration and efficiency improvements.
Air India Flights
KOLKATA: Tata Group’s low-cost carrier, Air India Express, has completed its merger with AIX Connect (formerly AirAsia India), a strategic move to create a unified budget airline under Air India with a focus on achieving sustainable profitability without straining its financials, a top company official said.
Dismissing concerns regarding the merger of AIX Connect, a loss-making entity, Air India Express managing director Aloke Singh said, “The merger process was completed in October. The integration of AIX Connect will expedite our path to profitability by achieving significant scale, optimising costs, and better utilising our assets. The objective is to build a robust, scalable network that supports long-term growth.”
Compared to a profit of Rs 117 crore in FY’23, Air India Express reported a net loss of Rs 163 crore in FY’24. This was despite a robust 33 per cent year-on-year (Y-o-Y) increase in income to Rs 7,600 crore, driven by higher passenger volumes and improved operational capacity. However, expenditure rose 38.3 per cent to Rs 7,763 crore during the year.
AIX Connect, which merged into Air India Express in October, reduced its net loss significantly to Rs 1,149 crore in FY24, down from Rs 2,750 crore in FY23, reflecting early benefits of the integration and efficiency improvements.
The restructuring has resulted in two distinct entities under the Tata Group — Air India Express, a low-cost carrier (LCC), and Air India, a full-service airline that merged with Vistara. Singh said, “This alignment has given us clarity to focus on different business models and markets.”
Acknowledging that the airline’s expansion phase might temporarily impact profitability, Singh emphasised a focus on measured and sustainable growth. “When you launch a new route, you have to develop the market with offers, incentives, and promotional fares, “ he explained.
Singh highlighted Air India Express’s ambitious plans to double its fleet to 175 aircraft within the next two to three years and expand its presence in both domestic and international markets. He noted that 50 per cent of the airline’s capacity is allocated to domestic operations, with a strong focus on connecting Tier 2 and Tier 3 cities to Metro hubs.