AirAsia to invest up to $60 million in new Indian airline with Tata
Skift Take
This could end up changing everything about the beleaguered Indian aviation market, and what a comeback story it would be for Tata, the first company to launch an airline in India in 1932.
Tata group, which started India’s first airline in 1932, is set to return to the industry as new Chairman Cyrus Mistry plans a budget carrier with Tony Fernandes’s AirAsia Bhd.
Southeast Asia’s biggest low-cost airline will own 49 percent of the venture. Tata Sons Ltd., the holding company of India’s biggest business group, will control 30 percent, while the balance will be owned by Arun Bhatia, whose son is married to the daughter of billionaire Lakshmi Mittal. Fernandes and Mittal own Queens Park Rangers Football Club.
Partnering with the $100 billion conglomerate, which controls Corus Plc and Jaguar Land Rover, will help AirAsia gain a foothold in a market that’s set to triple to 159 million passengers annually by 2021. The venture is the first to be announced after the government allowed foreign carriers to buy stakes in local airlines in September.
“We couldn’t have picked a better partner,” AirAsia Group Chief Executive Officer Fernandes said in an interview from London yesterday after the venture was announced. “We have a product which will have extremely low costs, have extremely low fares and will stimulate the market.”
AirAsia plans t
