Air India forms "dedicated team" to tackle its costly crisis

Dhaka: Air India has formed a dedicated team to identify cost savings across its operations, according to media reports, citing an internal memo.

Alongside forming the team, the airline has tightened spending approvals as it contends with airspace disruptions, the Middle East conflict, and elevated jet fuel costs, CEO Tewolde Gebremariam told employees in the memo.

Air India is moving to restore profitability and rebuild confidence in its safety record amid mounting pressure. It posted a loss exceeding USD 2 billion in the fiscal year ended March.

In August, the carrier was reportedly seeking roughly USD 1.5 billion in fresh equity from its owners, Tata Sons and Singapore Airlines.

Air India has also faced regulatory scrutiny following a fatal crash in June 2025 that killed 260 people, as well as safety and compliance lapses, including operating aircraft without valid certifications.

Meanwhile, Pakistan’s airspace ban and conflict-related disruptions in the Middle East have forced longer routes, cancellations, and cuts to international services.

Fleet modernization efforts have been slowed by shortages of seats and other components, delaying cabin upgrades. The airline is also seeking to defer deliveries of hundreds of aircraft currently on order to curb costs.

These challenges confront new CEO Tewolde Gebremariam as he works to turn around the carrier, which has not posted a profit since returning to private ownership in 2022.

In the memo, Tewolde said Air India has set up a cross-functional team dedicated to identifying cost-saving opportunities organization-wide.

He also announced an employee initiative rewarding ideas that cut costs or boost revenue, urging staff to embed frugality and accountability into daily decisions.