Air India Is Now a Smaller Airline: A Year After the Vistara Merger, What Went Wrong?

When the Tata Group announced the merger of Air India and Vistara in 2023, it was hailed as a historic move that would reshape India’s aviation industry. The vision was clear — to create a world-class, full-service airline capable of competing with global giants like Emirates, Qatar Airways, and Singapore Airlines.

But fast forward a year later, and the picture looks surprisingly different. Despite the grand ambitions, Air India today is a smaller airline than expected. Fleet rationalization, route overlaps, operational challenges, and a tough post-merger integration process have forced the company to slow down, recalibrate, and rethink its growth strategy.

The Promise of the Air India–Vistara Merger

When Tata Sons announced the merger between Air India (a government-acquired legacy carrier) and Vistara (a joint venture with Singapore Airlines), expectations skyrocketed.

The combined airline was projected to:
Become India’s largest full-service carrier.
Operate a fleet of over 220 aircraft, competing with global carriers.
Consolidate Tata’s aviation brands (Air India, Vistara, AirAsia India, and Air India Express) under one roof.

Deliver a seamless, premium flying experience — blending Air India’s heritage with Vistara’s service excellence. The goal was not just operational synergy but brand reinvention. Tata envisioned an airline that could restore Indian aviation’s global pride — something Air India once symbolized in its golden era.

However, the merger’s integration phase turned out to be more complex than anticipated, both operationally and culturally.

Why Air India Became Smaller After the Merger

A year after the merger’s completion, data from aviation regulators and industry analysts paints a sobering picture — the merged entity operates fewer flights and aircraft than initially projected.

Here’s why:

1. Fleet Rationalization and Retirements
Many of Air India’s legacy aircraft, particularly older Boeing 777s, 747s, and Airbus A320s, were found unfit for continued operations. Maintenance costs were too high, and fuel efficiency was poor.

As a result, Air India grounded several planes to streamline operations and upgrade its fleet with new aircraft ordered in 2023 — including 470 new Boeing and Airbus jets.

While this was a necessary step for modernization, it temporarily reduced Air India’s overall fleet size and available capacity.

2. Overlap in Routes and Operations
Both Air India and Vistara had overlapping domestic and international routes. To avoid duplication, the merged airline consolidated flights, cutting parallel services on popular routes like Delhi–Mumbai, Mumbai–Bangalore, and Delhi–London.

This network optimization, while efficient, also meant fewer total flights — leading to a smaller visible footprint in the short term.

3. Integration Challenges and Staff Restructuring
The merger brought together over 18,000 employees from two very different organizational cultures. Aligning policies, salaries, and work processes proved challenging.

Many staff members, including pilots and cabin crew, left during the transition, citing contract mismatches or uncertainty. Recruitment and retraining have been ongoing but slow.

4. Delayed Deliveries of New Aircraft
Global supply chain issues, especially at Boeing and Airbus, have delayed deliveries of new aircraft. This bottleneck has limited Air India’s ability to expand quickly and fill capacity gaps left by retired planes.

5. Regulatory and Technical Integration Hurdles
Merging two airlines isn’t just a business decision — it’s a regulatory marathon. Harmonizing Air Operator Certificates (AOCs), crew licensing, and fleet maintenance approvals took longer than expected.

All these factors together meant that, for a period, Air India’s combined operations shrank instead of expanding.

Conclusion: Smaller Today, Stronger Tomorrow

Yes, Air India is smaller a year after the Vistara merger—but this is a classic case of short-term contraction for long-term expansion.The Tata Group’s strategy is clear: rebuild the airline from the inside out, modernize every aspect of its operations, and restore Air India’s legacy as a symbol of Indian excellence in global skies.The coming years will determine whether this calculated restructuring delivers on its promise. But one thing is certain—Air India’s transformation under Tata is not just a revival; it’s a reinvention.