Air India was recently privatized, after being government-owned and losing money for years. The airline has been purchased by Tata Group, which also holds majority stakes in both Vistara and AirAsia India (and was the original owner of Air India many years ago, so this is a full circle moment).
Air India’s new owners have been looking for a new CEO to run the company. Well, the choice has now been announced (and unlike the rumors a while back, it won’t be former British Airways CEO Alex Cruz).
In this post:
Ilker Ayci appointed Air India CEO
Ilkey Ayci has just been appointed CEO of Air India, and he’s expected to assume the role no later than April 1, 2022. The 51-year-old was the Chairman of Turkish Airlines from 2015 until 2022. Prior to that he held several roles in the Turkish government, including being the President of the Prime Ministry Investment Support and Promotion Agency of Turkey.
Turkish Airlines is an incredible airline that flies to more countries than any other airline in the world, so hopefully Ayci can take some of what he’s learned from Turkish Airlines and use it at Air India.
Here’s what Ayci had to say about his new role:
“I am delighted and honored to accept the privilege of leading an iconic airline and to join the Tata Group. Working closely with my colleagues at Air India and the leadership of the Tata Group, we will utilize the strong heritage of Air India to make it one of the best airlines in the world with a uniquely superior flying experience that reflects Indian warmth and hospitality.”
Here’s what Tata Sons Chairman Natarajan Chandrasekaran had to say about the new CEO:
“Ilker is an aviation industry leader who led Turkish Airlines to its current success during his tenure there. We are delighted to welcome Ilker to the Tata Group where he would lead Air India into the new era.”
I’m excited to see what happens to Air India
Suffice it to say that Ayci has his work cut out for him at Air India, and I imagine this is going to be a more challenging role than he had at Turkish Airlines. A few general thoughts:
- It’s interesting to see Air India appoint an “outsider” to the role of CEO, with no strong connection to the Indian government; hopefully this allows him to take a fresh look at the airline
- Air India needs to be completely reinvented, with a new fleet, new inflight experience, and more efficient business model
- I’m curious to see if Air India goes premium, or if Air India becomes more of a budget or hybrid carrier; the latter makes a lot more sense to me, but we’ll see how that plays out
- I’m curious to see how this works out for labor relations; this is going to be significantly different at Air India than at Turkish Airlines
I wish Air India all the best and hope the airline succeeds now that it’s privatized. I just have my concerns, because it almost seems like you’d be better off starting from scratch than acquiring Air India and all of its legacy problems.
Bottom line
Former Turkish Airlines Chairman Ilkey Ayci has been appointed CEO of Air India. Ayci has been the Chairman of Turkish Airlines for several years, and he has his work cut out for him. I’m excited to see what he is able to do at Air India, and if the airline can actually reinvent itself.
I’m curious to hear what OMAAT readers think — is an Air India turnaround possible?
(Tip of the hat to Neeraj)
With his departure - what does this mean for THY ?
WOWWW MY ENDIA CEO IS TURKISH AY HAI MAZA AA JAI
It’s a Master stroke from Tatas !! So no more credit or freebies to The government … if you need the services … just pay !! An indian would not be able to do justice to the job . And he would become very predictable and puppet in the hands of the govt !!
I had no doubt about the guy competences but the culture challenges is too big and this would be the reason he will not achieve satisfactory results soon. Tata is wrong this time ,they should choosed British CEO , as Indian culture tend to swiftly deal with British.
Only if Ratan Tata is given a free hand in running his personal property and the babus and babujis kept away at beyond smelling.distance.
Ilker Ayci is a good choice to run Air India as a CEO but a surprising one. I wish him all the luck in the world in turning Air India around. He needs it.
This will be the best move from Mr tata to let prior TK CEO run air India
If this CEO can return AI to the glory days of old, then its got to be a good thing. Air India needs to be turned around and not only to be profitable once again, but also with emphasis on its product. With careful steering and a lot of patience this can be achieved. Slowly and painstakingly, the airline can rise once again. Being an Air Indian I wait with great anticipation to see how...
If this CEO can return AI to the glory days of old, then its got to be a good thing. Air India needs to be turned around and not only to be profitable once again, but also with emphasis on its product. With careful steering and a lot of patience this can be achieved. Slowly and painstakingly, the airline can rise once again. Being an Air Indian I wait with great anticipation to see how the next few months will unfold. This new CEO, with his wealth of knowledge and expertise will hopefully make that happen. Air India needs to robust, yet flexible. Determined and yet disciplined. There has to be a lot of changes for it to succeed and be competitive. I know what I would have to do if I was the CEO! But I wish Air India and the CEO all the very best in its future. And will most definitely be keeping an eye on its development
This is certainly exciting. Being someone who travels to India often and also being a Start Alliance elite, it has always been disappointing to travel on Air India but now if Air India service can take some hints from Turkish, that would be totally awesome.
Hope they keep 3-3-3 Economy configuration on their 777s. It has been quite comfy actually.
So it's not Sean M then?
Sean M is too busy figuring out more devious ways to confound the world with his diabolical use of acronyms! He once posted a reply that was literally 50% all acronyms!!
He is not talented enough to transform Air India as his appointment as chairman of TK was a great example of nepotism. He is very good at giving speech and playing backend games like politicians and he is also very good at burying people without proper judgement like mafia. His first move will be like bringing some other untalented guys from “the family”, and after one year when he will be leaving/fired he will leave...
He is not talented enough to transform Air India as his appointment as chairman of TK was a great example of nepotism. He is very good at giving speech and playing backend games like politicians and he is also very good at burying people without proper judgement like mafia. His first move will be like bringing some other untalented guys from “the family”, and after one year when he will be leaving/fired he will leave a demolished company which also lost its hope about transforming that they today have.
I didn’t expect Tata has made this mistake. It seems they wanted to demonstrate the change with western-ish look but that guy is not the guy they are looking for.
Really doubt that someone from Turkey is seen as giving the "Western look". Turkey is from a unique region and definitely not confused with Western Europe/US/Canada.
In any case, it is rather cool that they went for someone who has good experience with a solid Star Alliance global carrier. It will be useful for Tata Air India.
I agree completely. Dr Temel Kotil, CEO of TK until 2016 was behind its amazing transformation but he was ousted weeks after the 2016 coup attempt.
A fantastic choice which follows the ethos around strong system dynamics - the pillar that the Tatas have built their empire upon. I’m sure AI will flourish under the Tatas since they have a reputation for taking struggling brands and making them profitable.
@Ben - there was no confusion that Alex Cruz was not a candidate. With the exception of unverifiable reporting and this blog, there was never a doubt that he would not be at the helm.
Intriguing... can you expand on the system dynamics piece of this? Obviously we would all love an Air India redemption arc, but it feels like you must have some substance behind such a strong, early claim.
The choice sends a very key clear message about Tata's plans to integrate their multiple Indian carriers - Ilker is less an airline operations person than a high level manager with experience in the airline industry. His role will undoubtedly be to find the synergies and drive through some level of integration between Air India, Vistara, Air Asia India and Air India Express so that the group no longer has 4 carriers competing with each...
The choice sends a very key clear message about Tata's plans to integrate their multiple Indian carriers - Ilker is less an airline operations person than a high level manager with experience in the airline industry. His role will undoubtedly be to find the synergies and drive through some level of integration between Air India, Vistara, Air Asia India and Air India Express so that the group no longer has 4 carriers competing with each other. Not an easy task by any means, but I wish him well!
Air India has traditionally only been profitable on short haul international routes (Saudi Arabia, UAE, and Myanmar) and domestic routes from Delhi. The least profitable routes have consistently been to Australia. So it might make sense to stay relatively premium and invest in lounges in Delhi. You might be able to outsource domestic to other lower cost carriers and operate more similarly to say United. There may be opportunities to partner with a Chinese carrier...
Air India has traditionally only been profitable on short haul international routes (Saudi Arabia, UAE, and Myanmar) and domestic routes from Delhi. The least profitable routes have consistently been to Australia. So it might make sense to stay relatively premium and invest in lounges in Delhi. You might be able to outsource domestic to other lower cost carriers and operate more similarly to say United. There may be opportunities to partner with a Chinese carrier but there has traditionally been strong rivalries between the two countries especially since China tends to side with Pakistan in regional disputes. So the code share/partnership choices of most interest would likely be British Airways or Lufthansa to remain focused on business travelers but allow onward European connections.
Which is odd considering the absolutely enormous number of Indian expats residing in Australia, especially Melbourne. Considering QANTAS gave up direct India flights long ago (but might have, or was planning to resume the Dehli route) you'd think Air India would've enjoyed complete dominance in the direct flight market (especially in Melbourne where I would see flight crews staying in my hotel). Surprised they couldn't make it happen.
Good point but Singapore Airlines has always been the thorn in Air India's side ex Australia. They undercut on fares and many Indians like the prestige of flying SQ over AI including the transit at Changi which they also love.
Is there a chance Air India could go both ways - with a "luxury" (or at least high-end) premium business product, whilst running a LCC-style operation down the back in economy? There is so much potential here for AI on all fronts, realistically not enough to point the whole airline in an ultra-premium direction, but it would be great for India, Tata Group, and AI to have a first-rate business product to go with an expansive route network
Given the recent brouhaha over the airport code at Gaya the chances of Air India "going both ways" are limited, I think.
Seriously, surprised to see them select a Turk given the current political climate in India.
Not really surprising since the Tatas are group that are keen on system dynamics and that is Ilker’s strength. Although the government may not own the airline any more, I would not doubt its influence on AI. The political climate in India currently is nationalistic, not xenophobic.
Actually the political climate in India, is nationalistic, xenophobic and downright fascist and has never been more toxic.
"Is there a chance Air India could go both ways - with a "luxury" (or at least high-end) premium business product, whilst running a LCC-style operation down the back in economy?"
Isn't that what every airline is trying to do though? Ever more extravagant business class, while squeezing the economy folks into less and less space and service (in exchange for cheaper fares).
It's a good idea, but it's not a unique business model, and...
"Is there a chance Air India could go both ways - with a "luxury" (or at least high-end) premium business product, whilst running a LCC-style operation down the back in economy?"
Isn't that what every airline is trying to do though? Ever more extravagant business class, while squeezing the economy folks into less and less space and service (in exchange for cheaper fares).
It's a good idea, but it's not a unique business model, and that means they'll have plenty of competition should they try it. Frankly, I'm not sure how they should position themselves. I think the first steps will be much more unsexy stuff like reduce bloated headcount, improve operations (on-time performance, maintenance and dispatch reliability, IT infrastructure, etc), etc. And that's the easy stuff. Then they'll need to start reducing the legacy of political influence, such as cutting unprofitable routes that politicians forced AI to run, undo leases, contracts, and other sweetheart deals that previous politicians negotiated, purge incompetent political hires, and so on, so that they can finally refocus on economic viability rather than currying political favor.
Only after all of that, should they even think about how they should position themselves, which would entail embarking on a company-wide journey of buying new aircraft, redoing interiors, and other expensive endeavors that AI can't really afford right now.
FWIW, the Indian market has a lot of potential. I remember reading an article years ago that made the case that India should dump AI and focus instead on building up their airports to become a carrier-neutral transit hub. It sounds ridiculous, but cities like Delhi and Mumbai are actually pretty well geographically positioned for a lot of traffic such as Africa to Asia, ME and Europe to South/SE Asia, etc. If the basic goal of the government is to improve transit options and lower transportation costs for their citizens, then that goal would be served far better if they can make some of their airports genuine international hubs. After all, if Singapore and HK could become massive transit hubs, there's no reason why a few of India's airports couldn't do the same (with all the attendant benefits to the host city). That's probably more beneficial than having one local flag carrier.