The Air Merger

While this will come as bittersweet news for the frequent flyers for the reasons we’ll discuss later, the experts say this probably might be the best outcome for Air India. Singapore Airlines is coming together with the Tata’s to invest 250 Million Dollars in this new merger and this investment would mean Singapore Airlines would be having a 25.1% stake in the new merged airlines, Singapore Airlines already had a 49% stake in Vistara. 
Now coming to address why experts say this merger might be good; when Vistara came into business it was a joint collaboration between Singapore Airlines and the Tata’s, Tata had the operating management and it worked like a well-oiled machine, The frequent flyers loved the experience introduced by Air Vistara but when the Tata’s took back the control of Air India, things weren’t so good and definitely not good when compared with Air Vistara’s management, For Tata’s it made sense to merge Air India and Air Vistara, this would upgrade the flying standards and the overall service in the Air India’s side and for Air Vistara it would mean to serve a larger customer base but well frequent flyers fear this merger might bring down the quality of experience with respect to Vistara, Right now IndiGo Airlines holds a commanding position in the Indian domestic airline market, that is a market share of 57%, that is a massive chunk of market held by IndiGo, With this merger happening, it almost certain that there would be price war between both IndiGo and Air India – Air Vistara merger airlines, this would greatly affect the likes of Spicejet and other minor players, the price strain on these airlines are already immense after the Russia Ukraine war and two major airline players competing for market share would mean lower prices for the customers,  Even eating into 2% of IndiGo’s market share will call for a lot of aggressive market strategies, says Mr Bhargava, former executive director of Air India.  So what do you think, will this merger run a few airlines out of business?  Comment below.