Tata Sons is evaluating plans to set up an Air India ground-handling services company that will not only meet the airline’s burgeoning in-house needs, but also look at offering shared services to other carriers. Such plans may also include possibly bidding for the erstwhile state-run carrier’s ground-handling entity, Air India Air Transport Services (AIASL), which has been put on the block by the government. Before the government sold Air India, it hived off its business units such as ground handling to an entity called the Air India Assets Holding.
The proposed Air India entity may also house the aviation training academy announced in December 2022 as part of an organisational revamp. Air India is keen that the academy equals the biggest and the best globally. Funding for the proposed venture will come in from Tata Sons which has set aside significant funds for the aviation business for the next five years, officials said.
“That is the way forward discussed within the top management. Airport services and ground handling are also a critical consumer-facing role adding to the overall consumer experience in addition to the one inside the aircraft,” said an official aware of the discussions. The plans are expected to fructify once Air India comfortably progresses on its recent ambitious aircraft-purchasing plans, officials said.
“This is another ambitious plan that will take a big focus once the initial set of critical Air India operational needs are taken care of,” he said. The training academy and ground-handling services are parts of Air India’s ambitious plans to be a top global airline. Going ahead, Air India will require several home-grown pilots, engineers, cabin crew, airport managers and other function specialists.
The airline under Tatas is undergoing a massive transformation to be the best in class with regard to fleet, technology, organisation, and services offered since state control ended in January 2022.
Ground-handling issues had, however, cropped up in recent times and the Tatas would now seek to strengthen this area too, top officials close to the development said.
Tata Sons did not comment and neither did executives at Air India.
Boosting ground-handling services is critical for Tata-owned Air India as the aviation-to-automobile conglomerate aims to build a formidable global aviation entity. Problems pertaining to old aircraft and technology glitches have continued to surface from time to time even after the Tata takeover, preventing the carrier from soaring to its full potential. Even on Monday, Air India had to cancel a few flights due to aircraft-swapping issues.
Air India currently has an airports services joint venture with Singapore-based SATS Airport Services called AI SATS.
The airline has plans to expand the scope of this venture. They include the setting up of a multi-modal cargo hub at the planned Greater Noida airport, Sanjay Gupta, the CEO of the JV said in February. Among other things, the facility will include an integrated cargo terminal (ICT) and an integrated warehousing and logistics zone. Separately, the government plans to shortly invite bids for the airline’s erstwhile ground-handling subsidiary AI Airport Services and its engineering unit AI Engineering Services.