Air India to discontinue Vistara after merger

In December 2022, Tata Group announced that Vistara will be merged with Air India.

Tata group-owned Air India, will discontinue the Vistara brand on completion of its merger with Tata SIA Airlines Ltd, Air India’s CEO Campbell Wilson said at an online press briefing.

"The intention is to have one full-service airline and one low-cost airline in the group. The full-service airline will be an amalgam of Air India and Vistara," Wilson said during a virtual media interaction. He added that the idea was to carry forth the heritage of both Air India and Vistara, and work is undergoing to that end.

“Air India has embarked on probably the greatest transformation in aviation history and we have really been working higher over the 12 months to make this vision of creating a new Air India a reality. There were quite some years of under investment in Air India in terms of people process, systems and a lot of this requires strengthening and improving so that the aspirations that we have can be realised,” he said, during the virtual conference.

The Tata Sons-owned airline also announced that the list price for the order of 470 planes is $70 billion and that it plans to fund the purchase using a combination of sources, including internal cash, shareholder equity and sale-and-leasebacks.

Tata Group that took over Air India in January last year has announced that Vistara will be merged with the airline in December 2022.

Seeing two drastically opposite airlines merge as one, afaqs! spoke to business strategist, investors, marketers, advertisers about the impact of the merger earlier.

Lloyd Mathias, business strategist and angel investor, stated, “While in the short term it will mean a change of Vistara’s logos and livery, it will be a culture change within that will make the real difference.”

Amar Wadhwa, founder and executive director, CrystalEyes, a consultancy, said, "The merger with Vistara might do the airlines a whole lot of good."

Air India was nearly comatose and is now taking little steps towards its goal. “It is time for Air India to reflect what contemporary India is all about,” says Krunal Rawat, creative director, Landor & Fitch.

Also Read: Vistara merges into Air India; how will the ailing legacy carrier plan its rebirth?

As per Sambit Mohanty, Air India would do well to imbibe these Vistara’s superior flying experience, and ensure it tops the charts in customer satisfaction – “something that’s a sore point for the brand today.” He is creative head, south, McCann Worldgroup.

Vistara became the second-largest domestic airline in India in July 2022 and retained the title for six months. In January, Air India overtook Vistara as the second-largest airline with a market share of 9.2%.