- Air India stake loss hits $782 million.
- Airline reduced flights after crash.
- Singapore Airlines may need more capital.
Singapore Airlines reported a loss of about $738 million for the year ended March, with losses in the following three months running higher than in the previous quarter, the Financial Times reported.
“It has been an annus horribilis for Air India,” a Singapore Airlines executive told the Times. “Air India is trying to undergo a major transformation — the likes of which have probably never been seen in the airline industry — while also dealing with all these other issues. The timing could not have been worse.”
Singapore Airlines invested about $642 million in additional capital to acquire its 25 percent stake in the merged Air India after the Vistara-Air India merger was completed in November 2024. Tata Sons retained the remaining 75 percent. The transaction initially gave Singapore Airlines a one-time accounting gain of about $859.6 million. Air India later required additional funding, and Singapore Airlines injected another $130.5 million, taking its total investment to about $772.5 million.
The airline faced several setbacks after the deal was completed. Air India flight 171 crashed shortly after takeoff from Ahmedabad, killing 260 people. Air India then reduced operations to inspect its Boeing 787 fleet. Pakistan’s closure of its airspace to Indian carriers amid renewed tensions also disrupted operations, with Air India estimating the impact at about $600 million.
The carrier has also faced broader aviation challenges, including supply chain constraints, higher fuel costs and a weaker Indian rupee, which has increased expenses largely paid in U.S. dollars.
Analysts have raised concerns that Singapore Airlines may need to provide more capital support to Air India as the carrier continues its transformation. Any future funding decisions will depend on Air India’s business strategy and Singapore Airlines’ own capital requirements.
Amid its ongoing operational and financial challenges, Air India has appointed Tewolde Gebremariam, former chief executive officer of Ethiopian Airlines, as its new chief executive. He will take over from Campbell Wilson, who led the airline during the early stage of its turnaround. Air India is also working to improve its fleet, operations and network while keeping costs under control.
A recent ICRA report projects India’s airlines will face net losses of $3.81 billion to $4.02 billion in the year ending March 2027.
