Air India taps Singapore Air to bolster fleet upkeep after crash
(Bloomberg) – Air India plans to lean on shareholder Singapore Airlines, or SIA, to move some aircraft maintenance services in-house instead of outsourcing them to a state-owned company, according to people familiar with the matter.
The Indian airline is preparing to take on pre-flight and daily aircraft inspections, minor repair work and other troubleshooting activities from state-owned AI Engineering Services, or AIESL, said the people, who weren't authorised to discuss the matter publicly.
The phased move away from AIESL follows a deadly crash in June – the cause of which remains unknown, a sector-wide safety audit and a temporary safety-related pause in service.
Air India was in the midst of a transformation under its new owners – the Tata Group bought the unprofitable former state-run carrier in 2022 – when flight AI 171 crashed in the western city of Ahmedabad, killing all but one of the 242 people on board.
Gaining control of maintenance services was a part of Air India's restructuring plan even before the plane crash, but it had been put off in favour of getting more aircraft flying regularly and improving the experience on-board, the people said.
Concerns had been raised internally in the past as well about the service provided by AIESL – formerly a subsidiary when the carrier was state-owned – citing problems such as clogged toilets on flights, they said.
'Fleet Expansion'
The Indian carrier 'continues to work closely with AIESL. However, with our fleet expansion – 570 aircraft including a significant number of widebody jets – India's current MRO infrastructure is not equipped to support this scale,' an Air India spokesperson said in an email. MRO refers to Maintenance Repair and Overhaul services.
'To meet the demands of our future operations and ensure world-class reliability and safety, we must invest in building robust MRO capabilities and capacity within the country,' the spokesperson added.
SIA, which owns 25.1% share of Air India, will help in the transition of those maintenance tasks to the airline's staff, the people said.
'As a significant minority shareholder in Air India, Singapore Airlines has been working closely' to support Air India's transformation plan, a SIA spokesperson said in an email. 'This includes providing our expertise and support to Air India, where necessary.'
Air India's relationship with SIA in terms of assistance with aircraft maintenance comes full circle as it had been the one helping the Singapore-based airline during the 1970s.
Recent issues with Air India have also impacted SIA's earnings, contributing to a 59% drop in profit for the quarter ended June 30.
The Air India plane crash also brought sharp scrutiny in the sector on issues like the maintenance of aircraft.
Audit Findings
A recent audit report by the Directorate General of Civil Aviation showed Air India Group had the most issues among Indian carriers, according to an annual safety audit that began much before the crash.
A total of 93 findings were reported for Air India as part of regular surveillance under a safety oversight program, India's aviation regulator said July 30. That far exceeded the 23 findings for rivals IndiGo and 14 for SpiceJet.
Air India has a fleet of 191 aircraft while its low-cost subsidiary – Air India Express – operates 115 planes, according to flight tracking website Flightradar24. The carriers fly a mix of Airbus SE and Boeing aircraft.
More stories like this are available on bloomberg.com
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