Air India Express-AIX Connect merger complete; to serve as benchmark for upcoming Air India-Vistara merger: DGCA | Business News
India’s aviation regulator Directorate General of Civil Aviation (DGCA) announced Tuesday that the merger of Tata Group’s low cost airlines AIX Connect (formerly AirAsia India) and Air India Express has been successfully completed.
The merger of the two budget carriers is seen as part of the larger consolidation of airlines in the Tata stable as part of Air India’s transformation plan.
All aircraft of AIX Connect — which started as a joint venture between the Tata group and Malaysia’s AirAsia Berhad— have been transferred to the air operator certificate (AOC) of Air India Express. With this, the no-frills airline has flown into the sunset after operating for over a decade.
“The Directorate General of Civil Aviation (DGCA) has granted the requisite regulatory approval for the merger of AIX Connect (AIXC)…into Air India Express…Effective October 1, 2024, all aircraft of AIXC have been transferred seamlessly onto the Air Operator Certificate (AOC) of AIX (Air India Express), ensuring that airline operations of the combined entity continue without disruption to ensure a safe and smooth passenger experience,” the DGCA said on Tuesday.
The regulator sees the merger, which was completed in less than a year and without any disruption in operations of the two carriers and aircraft groundings, as having set a new benchmark and template for airline mergers in India particularly the upcoming Air India-Vistara merger. The DGCA will closely monitor post-merger operations of Air India Express to ensure compliance with all regulatory conditions.
“Our rigorous review ensures that this merger serves the public interest by fostering safe air operations while enhancing the overall travel experience for consumers. The insights gained from this experience will prove valuable for the upcoming merger of Air India and Vistara, which is currently in progress,” said DGCA Director General Vikram Dev Dutt.
The group’s full-service carriers (FSC) Vistara and Air India are set to merge on November 12. Following both the mergers, the Tata group will have two airlines—a low-cost carrier (LCC) Air India Express and an FSC Air India. Air India Express is a fully-owned arm of Air India and both airlines were acquired by the Tata group from the government in early 2022.
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AirAsia Berhad, which was initially a partner in AIX Connect, had exited the airline in 2022 after selling its stake in phases to the Tata group. The AirAsia India brand was retired in 2023, with AIX Connect operating flights in sync with Air India Express to serve the combined network of the two airlines. The enlarged Air India Express has a fleet of 88 narrow-body aircraft and is likely to cross the 100-plane mark by the end of the year. The enlarged Air India Express offers flights on 171 routes—domestic and short-haul international.
“About a year ago, we started the integration of AIX Connect and Air India Express, bringing the two organisations together behind a common brand. Alongside, we worked on the complex integration exercise culminating today in the operational and legal merger of the two organisations. The close collaboration amongst DGCA, BCAS (Bureau of Civil Aviation Security), and MoCA (Ministry of Civil Aviation), AIX (Air India Express) and group leadership teams and many other colleagues were instrumental in the success of this exercise,” Air India Express’s Managing Director Aloke Singh said.
“The merger of AIX Connect and Air India Express was a complex endeavour involving the integration of aircraft, pilots, cabin crew, engineers, operational control systems, aircraft maintenance, certification procedures, and a wide range of contracts, vendors, and backend systems. Considering the safety challenges that arise during the merger of two running airline systems, DGCA’s role has been pivotal in ensuring that all regulatory and safety requirements have been meticulously complied with and effectively implemented,” the DGCA said in its statement.
According to the regulator, such a transition would typically require grounding the fleet during the transfer of aircraft from one AOC to another. Given that this process could inconvenience passengers and impose financial strain on airlines, the DGCA worked with all stakeholders to ensure regulatory compliance for the merger without disrupting the operations of either airline.
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“In order to achieve the dual objectives of maintaining the highest safety standards while simultaneously ensuring a smooth transition without grounding of aircraft, DGCA constituted a dedicated project team which coordinated the necessary actions to secure regulatory approvals in a time-bound manner. The approval process for this merger involved reviewing organisational structures and approvals, ensuring a seamless transfer of aircraft and personnel, and safeguarding the safety of ongoing operations,” the aviation regulator added.
