I’m simultaneously amused by this concept, and also think it might not be the worst idea ever?
Continue reading: Rumor: BA’s Alex Cruz To Become Air India CEO?!?
Share your questions, experiences, and thoughts below.
Given that he was pushed out of BA for not doing so great it's interesting to see him fail upwards into another top job.
He may be a nice guy but he wasn't a very nice boss of BA
Anyone who doesn't understand India and how to navigate a typical Indian business will eventually fail. Unless there is someone else in a COO type role to handle that bit.
Hopefully that ULCC past of him from BA doesn’t carry over to Air India. The market is completely different. It is a market where LCC and ULCC carriers like Indigo, Air Asia and Spicejet allows check-in baggages even in the lowest fare. And complementary meal + flex ticket can cost as less as $3-5 more upon base fare.
If he does any of those strategy on AI, he won’t last long in the job and AI will probably be under a lot of pressure from other domestic competitions and it’s own sister airline, Vistara.
Air India is a lost cause. Cruz will never be able to solve the nepotism that is inherent in (formerly) state-owned airlines like these in corrupt countries.
All of the local staff will just shut him out once they realise their jobs are on the line and he will never get anything done.
Short of firing every single staff member and rehiring the entire company based on merit rather than favours or corruption, I do not see how he will change anything.
I could see him as CEO at Etihad because they have financial issues but seem to have a much better structured workforce.
Its going to be an interesting journey for Air India in the near future. I personally feel that the fate of Air India is going the mirror the Indian Economy. Given the aviation fuel taxes and other costs its very difficult to run a profitable airline in India. The way to overcome that might be through running a premium product that people are willing to pay for. That being said its difficult to do that domestically given the purchasing power of average Indians and the competition from the LCCs. On the other hand, its also difficult to compete in international economy given the deep pockets and government backing of Qatar and Emirates. Where Air India can really compete is in getting the major chunk of business focused direct connectivity between major cities (SFO, JFK, EWR, SEA, LHR, TYO, FRA etc. to DEL, BOM, BLR, HYD). They can invest in a product that beats the United, Delta, AAs, BAs, etc. (bit easier to do relatively) and which a customer is willing to pay for. They should also invest in a premium economy that can be geared towards the traveler that is willing to pay a little extra for the comfort on these long haul flights. Air India already has slots in these major cities and all they need to do is to invest in the hard and soft product but more towards the business end of the scale. In addition, Air India should invest in its loyalty product and cut down on routes that don't fit this strategy. Another thing they could possibly do is to join the one world alliance, since their direct connectivity from the US and Europe to India is relatively sparse (However, I can see the other side too where given the volume of frequent fliers on Star Alliance in these countries, Air India might find it easier to fill seats through reward redemptions). Last, Air India can go totally left field and invest in routes that no other airline would serve by procuring 321XLRs and so on but that would be a big risk with no immediate rewards!
Air India was privatized for this very reason. The government has sold all its stake and has no more say in the affairs of the airline other than some contractual clauses in place for the first few years. The overtaking company is already running a highly rated full service airline in India with mixed business performance. So they have experience navigating the labor laws and local regulations.
Air India has a very good chance to succeed if things are done right. Its going to be a challenge but they are still in the game.
Yeah..."seems like a nice guy". What does that even mean? Lots of people are nice in one aspect of their life but are shitty at their jobs. Or, not generally "nice" but manage to keep up appearances. This is such a silly non-statement that gets batted around OMAAT way too often and detracts from an otherwise okay analysis. Might as well say, "Blue seems like a nice color."
@ Niko_jas -- In fairness, I'd assume he was pushed out by Willie Walsh, and I'd almost consider "not doing so great" by Walsh's standards to be a complimentary.
@ DCA Will Always Be "National" -- I didn't say "he's a nice guy, therefore he should get the job." Why do I point out when I perceive people to be nice? Because I like nice, pleasant people. Nothing more than that. There are some airline CEOs who come across as complete jerks, and Cruz isn't one of those people. I just think that's worth acknowledging when it's the case.
@ Vijay -- In fairness, the previous CEOs failed as well, and I think they had an understanding of India and how to navigate business in India, no?
I entirely agree to manage Air India, a non Indian is required. Better margins are available in International routes compared to national (within India).
There is great opportunity for Air India to grab the customers of Emirates, Qatar, Etihad,...
He did more cost cutting than he did premium expansion, which might be okay for Air India given they have significant LCC competition and need to focus on doing the basics well before competing on a premium basis. That said - did BA even do the basics well under Cruz? I think that's debatable.
They weren’t really CEOs. They were more of nepotism appointments or bureaucrats. One of the more recent one was ex chairman of the Railway Board of Indian Railways. Unlike ME3, government never appointed a professional as CEO of the airline.
I heard Josh Cahill was becoming CEO as he is so experienced . He mentioned on his website he is often contacted by airlines for advice.
They better spruce up the interior of these planes bf charging BA Business class fares. Also service. The ratings are horrible.
First they need to improve or hire totally new customer service staff. They do not want to work after spending with them sometime they say i do not have access and transfer your call. They literally do not want to work.
Air India has only one way to go -- UP I stopped flying Air India 20 years ago. Service was horrible. Baggage would take 24 to 72 hours to arrive.
Agree, Nik
.. but I have to be fair and add the following:
- Tata is a highly successful corporate - and are hard task-masters. If an individual were hired as CEO and didn't satisfy Tata's standards, they wouldn't last long at all.
- Nothing will be fixed, corrected or improved in the Indian travel marketplace generally - until the aviation policymakers of the GOI (Government of India) are fired and replaced with competent individuals, rather than simple 'yes' men.
- The range of outdated policies that persist in this market is extraordinary. And in many cases, they are exactly what permits and encourages concepts such as nepotism, corruption and industry inefficiency,
One only has to look at the 'bankruptcy' process that Jet Airways endured, as well as the 'inspired' act to combine (domestic) Indian Airlines with Air India, and the tortuous' multiple attempts to sell the airline.
We won't mention acts like cannibalizing perfectly operational wide bodies to serve as parts replacer's for what-ever reason.
- Regrettably, there is still a large element of 'old boy network' operating within and between the ranks of government officials and wealthy individuals who are happy to pedal their influence.
Tata has managed to run respectable aviation operations and one hopes that their professionalism will continue to prevail. If the GOI try to resist change or try to claw back 'old ways', then there will be no hope for *any* Indian airline.
I have met Cruz. He is the most abrasive, low-cost carrier mentality guy I have ever met. Absolutely the wrong choice for Air India. Might work for Air Asia, though.
@Vijay - Tata Sons are very much aware of the implications of having an ex-pat as a CEO for its brands. The fear that an ex-pat will fail to be effective in India is rather outdated. Tata appoints CEOs of various origins for its subsidiaries but make no mistake, they are very much always in control. More important than the CEO is the board of directors. Some of the major Indian corporate leaders have been appointed to the board of Talace. Ultimately, the CEO acts on the advice of the board so need not fair that the CEO will be unsupported in India.
@Ben - prior CEOs did not fail AI. AI's vision over the past five decades simply did not prioritize profitability of the brand. Profitability is not a government entity's priority. The emphasis for AI has always been on developing air travel as a convenient and economical alternative for its citizens. In that respect, AI succeeded since it was the first large domestic airline which initiated the air travel industry in India. Prior to 1990s, India hardly had an air transport industry and no one was willing to invest into the industry except for Air India. Everything needs to be observed in context and AI's success is not to be measured in the form of profitability nor star ratings in a country where the vast majority have still never flown. Now that the Indian air travel industry is booming, AI's government-led initiatives are naturally at an end so it's good that the government divested (albeit probably ~ 5 - 10 years later than necessary). The government always stated that its interest in AI went beyond economic interests and included strategic political needs and AI served as an important arm of the government's national needs.
I flew on KLM five years ago from AMS to SIN and count that business class flight as one of the worst air travel experiences ever, with baggage reaching me 3 days later. However, it's hardly representative of KLM. So, I don't understand how one reacts to this comment.
I have flown AI frequently for work travel within India and frequent trips from the bay area. Granted that the flights are not extravagant, but I consider them to be on par with the quality of travel offered by AA, UA or DL. I get it that it's not saying much when one compares airlines to the US carriers, but no one goes out of the way to degrade the US carriers either. The comfort and soft service on AI (economy) have frequently exceeded what is is offered on the major NA or EU airlines. This comment is based on the few times that I have flown economy on AI.
What do you base your advice on? The domestic air travel volume in India will always exceed international routes. The margins on international routes may actually be worse if AI intends to compete with the gulf airlines. A better alternative is to focus on lucrative premium routes (the most premium in for AI and India, and the busiest in the world being DEL-BOM as an example) and select international routes which are lucrative but offer little competition to direct flights for AI (AA, UA and DL may be trying to offer alternatives but they will never be competitive in India due to the regulations and ground costs for operating in India).
Calm down.
I know you’re watching his current series, but don’t make a fool of yourself.
If I mistook your sense of humor, I completely apologize.
I think he’d be a good choice and hopefully turn the tide and make AI a viable carrier
I will like to disagree that one should have an outsider to run Air India as CEO.
Aiming Emirates, Etihad and Qatar airlines to improve the market share is a good idea. But why was Cruz ineffective in doing that while he was the CEO of BA. There is a huge British population living in the Middle Eastern countries. Still he could not take advantage of it. My personal experience flying BA during his tenure has had been miserable.
Making cheap cuts does not make the organization loved by the flyers. Everyone looks for quality service, timely service and proper handling of passenger baggage.
And why do one forget that top 10 global corporations are headed by Indian CEO’s.
India has enough talent.
CRUZ IS THE RIGHT MAN
DEFINITELY
HE WILL CHANGE THE FACE OF AIR INDIA !
AIR INDIA NEED FRESH START
FRESH FACE FROM THE BITOM LINE !!
CRUZ IS THE RIGHT MAN
DEFINITELY
HE WILL CHANGE THE FACE OF AIR INDIA !
AIR INDIA NEED FRESH START
FRESH FACE FROM THE BOTAN LINE !!
AIR INDIA SHOULD’NT LOOSE BUT IT’S WAS
RUIN FINANCIALLY BY HIS OWN STAFF !
OUTSIDER IS THE BEST OPTION AGAINST CORUPT LEADERSHIP !!
JAI HIND
In total agreement. I don’t think that the nationality of a businessman matters in this day and age where most corporate leaders are experienced with multinationals and foreign organisations (and educated in a multinational environment). I think the comments on commending Air India for seeking a foreign CEO (or puppet) are made by people who have little to no understanding of the business and markets today. Many global corporations have expat CEOs since the emphasis is on competencies and diversity, and not nationality. For what it’s worth, I’ve always considered BA to be a horrid airline and an extension fitting of the United Kingdom - glorious past and a dilapidating present. Anyways, the Tatas are fully aware and in control of their fortunes and whoever becomes the CEO, will be on a tight leash.
I dunno. I would echo the sentiment of others who decry his tenure as downgrading BA back to the “Bloody Awful” days. Would probably be happier if they took in the guy who ran MH and tried to turn it around until boardroom politics forced him out.