Air India Seeks ₹10,000 Cr Aid From Tata Sons, Singapore Airlines Amid Mounting Losses

Amid the worsening operating and financial condition, Air India has reportedly reached out to its owners for financial support. Air India is owned by Tata Sons (74.9%) and Singapore Airlines (25.1%).

The carrier is seeking ₹10,000 crore (about $1.14 billion), according to a Bloomberg report. The funds would be used to overhaul Air India's systems and servers. It will also help them develop in-house engineering and maintenance departments.

The airline was previously under the Indian government’s control until the deal in 2021. A year later, it reorganised its ownership by bringing Vistara Airlines under the brand's fold. The latter was a joint venture between Tata Sons and Singapore Airlines.

The demand comes in the backdrop of the deadly crash the airline faced earlier this year. On June 12, Air India flight AI171 (a Boeing 787-8 Dreamliner) crashed shortly after take-off from Sardar Vallabhbhai Patel International Airport (Ahmedabad), bound for London Gatwick.

The crash claimed 241 lives on board and 19 on the ground, bringing the total fatalities to around 260.

Following the crash, the airline announced an interim ex-gratia payment of ₹25 lakh each to the families of the deceased and survivors to help with immediate needs. This interim payment is in addition to the broader relief commitments by its parent group. Tata Sons announced an ex-gratia amount of ₹1 crore for each family of the deceased in the crash.

Additionally, Tata Sons, together with Tata Trusts, set up a welfare trust of ₹500 crore called the “AI-171 Memorial & Welfare Trust” to support not only the deceased families but also reconstruction (of the affected college hostel), long-term welfare, trauma support, etc.

Crash Hits Transformation Plan

Following its acquisition in 2021, Tata Sons launched a five-year transformation programme called Vihaan.AI aimed at making it a world-class global airline with an Indian heart. The three-phase plan was supposed to make the carrier profitable by March 2027.

But the cost of the Ahmedabad crash, the airspace ban earlier this year amid India-Pakistan tensions, and global jet supply shortages have reportedly made the goal nearly unachievable. Meanwhile, safety concerns after the tragic crash have prompted a system-wide audit by India’s aviation regulator. Air India also reduced its international flights operated by widebody jets by 15% between June and August, which further dented its revenue.

For the year ending March 2025, Air India’s revenue rose about 15% to ₹78,636 crore (from ₹66,556 crore in FY24). However, the airline's losses widened to a consolidated loss of ₹10,859 crore.