MC Interview |Air India Express will have fleet of 180 aircraft by end of 2028: CEO Aloke Singh

Aloke Singh CEO- Air India Express

Air India Express, the low-cost carrier of the Tata Group, plans to increase its fleet size from the current 64 aircraft to 180 by the end of 2028, the company’s managing director Aloke Singh said.

"Air India Express will take delivery of three new aircraft every month and one additional aircraft every other month in 2024, and our five-year plan is that we will go to a fleet size of about 180 aircraft by the end of 2028," Singh told Moneycontrol. In total, the airline will take delivery of 42 aircraft in 2024.

Singh said that since October 2023 Air India Express has added nine aircraft, with continuous monthly additions. At the moment, the Air India group has not taken a final decision on the number of Airbus A320neo, Airbus A321neo, and Boeing 737 MAX narrow-body aircraft that will be distributed between Air India and Air India Express, he added.

Singh said that due to the length of the delivery schedule for both the Airbus and Boeing aircraft, the airline under the Tata Group will decide on fleet size and aircraft deliveries based on requirements.

Fungible fleet

He added that Air India Express will have a fungible fleet comprising Airbus A320neo, Airbus A321neo, and Boeing 737 MAX narrow-body aircraft.

"The fleet will be fungible. Aircraft type will be fungible. We may decide to operate one aircraft type under one model today and we may decide to operate another model. That is the flexibility we want. Having a multiple fleet type and the model that we have, most certainly there may be sub-optimalities. But with scale, as you grow, the benefit of commonality starts diminishing," Singh said.

So far Air India Express has no plans to operate wide-body aircraft, and all wide-body planes being delivered as part of Air India's mammoth 470-aircraft order will go to Air India, he added.

Air India Express also plans to increase its market share in the Indian domestic market from the current 7 percent to 15 percent by the end of 2028.

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"Our target for five years is that we will grow our domestic market share to about 15 percent. It is a very rational and well-thought-out number. Short-haul internationally we aim to grow from about 11-12 percent today, to 20 percent. We will aim to double the market share in both sectors," Singh said.

AirAsia merger

The merger of Air India Express and AirAsia India will be completed in the next three months and the two airlines will start operating from its new headquarters in Gurugram, in the same complex as that of Air India.

In November 2022, the Tata Group announced the merger of AirAsia India and Air India Express. As a part of the transaction, AirAsia Bhd divested its 16.67 percent stake in the airline, allowing the Tatas to buy it for Rs 155.65 crore.

Singh said that as part of Air India Express' growth strategy going forward the merged entity will focus on connecting Tier-II cities with international destinations and metros, which has been the unique selling point of Air India Express in the past.

"We don't want to open too many stations. We want to open one station, add some more flights out of that, increase the connectivity and spread out of that, and then move to another. And I keep giving this example, a case in point is Surat. We started Delhi-Surat earlier last year (2023). Then we added capacity. We connected it to Bengaluru, Kolkata, Delhi flights and Dubai. Now maybe we will add a second flight from Delhi," Singh said.

Going forward the merged entity Air India Express will deploy 50 percent of its capacity for international operations and 50 percent on domestic operations.

"After about two years, the share of domestic operations in our capacity will rise to around 60-65 percent," Singh said.

He added that Air India Express does not plan on changing the livery of its existing legacy fleet and intends to return the aircraft currently on lease to the lessors once the lease period ends. "All our Airbus A320 aircraft are on lease and around 10 Boeing 737-800 are on lease. These aircraft will go back once the lease period ends," Singh said.

Air India Express in October, 2023, unveiled its new brand identity and aircraft livery that consists of four colours – orange, turquoise, tangerine, and ice blue – at a ceremony at Mumbai airport.

Air India Express is also open to launching a loyalty programme for customers. “It may not be a full-fledged loyalty programme but will be a basic loyalty programme which may have some linkage with Air India programmes as well," Singh said.

Under a government-led strategic divestment programme, the Tatas acquired full ownership of both Air India and its subsidiary Air India Express in January 2022.