Singapore Airlines & Tata join hands to launch an airline in India

I was travelling all day yesterday and hence could not bring you the good news! The Tata conglomerate, some of whose family members have been really passionate about aviation, put their hat back in the Indian aviation game earlier this year. First, they signed up to be a 30% shareholder in Air Asia India, which plans to launch a low cost airline in India by early 2014.

And just yesterday, a new press release from the Tata group announced that they have signed up to make a 51:49 joint venture with Singapore Airlines, which will aim to launch a full-service airline in India with an initial investment of $100 million.

While I am totally surprised by the move to cover the full spectrum with two airline partners who are as different as chalk & cheese, I am waiting further to see what happens next. Jet Airways covers the whole space with two different brands but the same infrastructure, others have stuck to a niche itself (Air India –> Full Service & Indigo, Spicejet, Go Air –> Low Cost Carriers), but a business house owning stakes in two airlines, and a majority in one of them, looks like a new strategy to me.

The Tata group and Singapore Airlines go back a long way of course. It is said that Singapore Airlines was modelled on Air India back in the day when they launched (yes, Air India used to be that good!). In 1996, Tata wanted to set up an airline in alliance with SIA which never took off. In 2000, Tata & SIA came together to try and buy a 40% stake in Air India but their move was thwarted. And now they hope to get third time lucky.

While I am waiting to hear more on this… what do you think about this move?

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Comments

  1. Hi AJ,

    I have AMEX 100K membership rewards points from US issued card. I am now in India and have no current plans of going back to US. What do you suggest I do with the points? With Singapore airlines’ JV with Tata, is it wise to convert it to KrisFlyer miles? Any other suggested use of points will be helpful too.

    Thanks!

    • @Michelle, sure it is possible to start without the Tatas. Except Tatas are happy to open JVs with people who want to enter India and they have the reputation of being honest business men. Even Zara is there with them, apart from Starbucks. And of course they own Jaguar Land Rover now.

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