IndiGo VS Air India

-Diksha
21SJCCC217
  IndiGo is an Indian low-cost airline headquartered in
Gurgaon, Haryana, India.
COMPANIES IN COMPARISON
 It is the largest airline in India by passengers carried
and fleet size, with a 59.24% domestic market share
Indigo as of August 2020.

vs  Air India is the flag carrier airline of India,

headquartered at New Delhi. It is owned by the
Air India Government of India, which has approved the sale of
Air India Limited to Talace Private Limited, a
Special-Purpose Vehicle of Tata Sons.
 The sale is expected to close in December 2021
  The airline industry is a challenging business and is
quite unique compared to most others.
 It's a highly regulated business requiring an emphasis
on safety, speed and exceptional customer service, all
ORGANISATIO while keeping costs as competitive as possible

NAL  most airlines use a functional organizational

STRUCTURE structure, in that management is organized from the

top down, more or less resembling a pyramid with
airline departments or divisions based on the
different functions of the company.
ORGANISATIONAL STRUCTURE OF AIR INDIA

• Air-India submits a yearly report of its activities to the

Parliament through the Ministry of Civil Aviation.
• It enjoys functional autonomy and its management is
• through a Chairman and Managing Director (CMD) who
works under a Board of Directors.
• The Board is re-constituted every two years by
• the Government.
• The Board of Directors is the highest governing body of
Air-India.
• Chairman cum Managing
• Director (CMD) is the Chief executive of the corporation.
• The corporation has its headquarter in Bombay.
ORGANISATIONAL STRUCTURE OF IndiGo
• All Activities are divided into task Groups
with professionals and experts
• IndiGo coordinates operations in all its
units across the world to ensure that there
is a smooth flow in operations
• Most of the purchasing activities are
centralized to minimize costs
• This structure coordinates and motivates
employees
 AIR INDIA
• Tatas will get Air India’s 117 wide-body and narrow body aircrafts
and Air India Express’s 24.It will operate these aircrafts on over
4,000 domestic and 1,800 international routes.

 Out of Rs 18,000 crore, Talace will retain Air India’s overall debt
worth Rs 15,300 crore, while the rest will be paid to the Centre as
the cash component.

PLANNING  Tata Sons' $2.4 billion purchase of debt-ridden, government-owned

Air India will give the conglomerate immediate access to valuable
flying rights and landing slots.

 The ownership transfer from the government to Tata is expected to

go through by the end of the year. The company will then have until
summer 2022, when a post-COVID demand surge is expected, to fix
the issues, estimating it would cost more than $1 billion to refurbish
Air India's 141 planes and up to $300 million to retrain staff and
improve operations and service.
 INDIGO
 As of January 12, 2021:In order to further strengthen domestic
connectivity, it plans to initiate flights from seven new stations
which include Leh, Darbhanga, Agra, Kurnool, Bareilly, Durgapur
and Rajkot.

 It is aiming at running at full capacity domestically by December

PLANNING 2021 and is targeting just over two-thirds in international routes as
the virus pandemic eases and people start traveling more.

 Indigo enjoys the largest market share in passenger traffic (India),

it plans to expand by investing in acquiring aircraft and more fuel
efficient engines thereby making air travel affordable and
enjoyable in India.
 AIR INDIA
Air India and Air India Express has 13,500 employees and a fleet of 141 aircraft, and
the resultant employee-per-aircraft ratio has fallen by more than half to 95.
 Air India suffers from is too frequent changes in the chief executives, when compared
with private airlines. Lack of vision and commitment in leadership leads to morale
suffering.
The government has mandated that the Tata Group retain the airline’s employees for
a period of one year from the close of transaction and any retrenchment after that be
done by the way of a voluntary retirement scheme (VRS). 

STAFFING INDIGO
 While Air India focuses on stability of personnel , Indigo has announced
IndiGo Recruitment 2021 of IFS (cabin crew), Flight Operations,
Engineering, Maintenance, Customer Support, Trainee, Jr. Technical
Officer. Asst. Trainee, Quality assurance etc.

 Our culture of 'Respect all, Recognize efforts & contributions and Reward
excellence' is ingrained in our reward and recognition framework called 3R.

 Rewards such as Employee of the Quarter, 6E Claps (peer-to-peer), 6E

Achievers (employee of the month) and more, function-specific Rewards
such as Best Trouble Shooter for IT or 6E Fast Tracker for Airport
Operations & Customer Services keep staff motivated
 COMPARING WORK EXPERIENCE IN
AIR INDIA VS INDIGO
Compare company ratings
Compare management, culture and compensation ratings for Air India and Indigo Airlines .

4.0 4.2
Overall Rating Overall Rating
3.9 3.8
Work/life balance Work/life balance
3.3 3.7
Compensation and benefits Compensation and benefits
3.7 4.0
Job security and Job security and
advancement advancement
3.5 3.9
Management Management
3.8 4.0
 DIRECTING
 Monitoring of On Time Performance
Administrative control of al Corporate functions represented in the Region.

 Ownership of Business & Operations outcomes for the Region.

AIR INDIA Responsible for meeting the targets on revenue and profitability as set for the
region.

 Efficient functioning of all the functions of the Company within the jurisdiction
DIRECTING allotted.

AND  To be the coordinating and controlling authority and carry out all

CONTROLLI correspondence with Headquarters in the manner provided.

Manage contracts related to day-to-day operations of region in consultation with

NG Corporate

 To ensure proper and optimum utilization of aircraft, crew and staff.

 Proper disposition and positioning of aircraft and crew for scheduled and non-
scheduled operations in accordance with operational needs.

 Operations administration including the operation of all scheduled, non-

scheduled and charter flights etc.

CONTROLLING
  In IndiGo, the increasing profits shows that in the
DIRECTING organization activities are performed as per the plans, also
the organizations resources are being used effectively and
efficiently.

 IndiGo closely monitors its operations and evaluates its

INDIGO performance against organizational targets.

Auditing is normally carried out on a regular basis to ensure
that the organization is moving in the right direction.

DIRECTING  Any deviation from the set standards is adjusted through

appropriate corrective measures.

AND  In comparison to competitors, the workers are provided with

CONTROLLIN
healthy working conditions, incentives and motivation.

 Teamwork is encouraged across all hierarchical levels and

G all members of staff are given an opportunity to participate in

decision-making.

 Creativity and innovation is highly encouraged among the

employees in order to give the firm a continuous competitive
advantage.

 IndiGo enjoys a good relationship with other external

stakeholders such as various governments,
shareholders and the local community. CONTROLLING
  The global outbreak of COVID-19 pandemic and the nation-wide lockdown
imposed from 25th March 2020 and followed by multiple extensions in 5 AI
lockdown/restrictions imposed by Central/State Governments had a major impact
on the aviation industry.
 AI had to cease all scheduled domestic and international operations in compliance
with the directions issued by the DGCA in the aftermath of the pandemic.
 Air India operated a very courageous first repatriation flight to Wuhan – the
epicenter of the Covid-19 virus - to evacuate stranded Indians on 31st January

IMPACT OF 2020
 The international borders were sealed all over globe resulting in Indians getting

COVID stranded all over the world and the Company conducted some essential air
operations like non-scheduled flights under the ‘Vande Bharat Mission’ from 7th
May 2020
 AI also operated special charter flights on domestic and certain international
sectors to facilitate the movement of essential medical and other supplies to
various parts of the country and the world.
 the Government of India has signed bubble agreement with 22 countries purely to
serve 3rd/4th freedom market. Currently, AI is operating International flights

AIR INDIA
under these Bubble agreements.
• During the financial year 2019-20 the Company had incurred a net loss of Rs.7,982.82 crore as against Rs.8,556.36
crore in the year 2018-19, representing a decrease of Rs.573.54 crore.

• The number of passengers carried during 2019-20 increased to 22.1 million as against 21.8 million during 2018-19.

• Air India has spread its wings far and wide during the pandemic by operating flights to 81 international
destinations more than double from 39 in pre-Covid times.

• As a result of the pandemic , most employees suffered steep pay cuts and delayed payments of wages.
  To begin with, the airline has converted its 10 aircraft into freighters which resulted in
higher throughput.

 As passenger revenues tanked during the lockdown, IndiGo ramped up their cargo
operations due to high demand for transporting essential supplies.

 The sharp rise in the international cargo rates - from about $1,000 per tonne to $3,000 per
tonne - during the lockdown has further improved the viability of cargo flights. 

  the current restrictions and circumstances have suppressed the demand; it has given
IndiGo a chance to keep its inefficient planes (A320ceos) grounded, and fly A320neos which
are compliant with aviation regulator directorate of civil aviation (DGCA) rules.

IMPACT OF  Had there been no flying restrictions, IndiGo would have been flying A320ceos as well (or

COVID
even extended their leases) - to keep its market share intact - even if they would have
burned a hole in the airline's pocket.

 IndiGo has gained significant knowledge of potential international destinations through

direct charter flights it has operated during the pandemic. Typically, these routes would
have been routes served with widebody aircraft via a hub

 salary cuts of 5 to 25 per cent across the organization (except for certain employees with
lower pay grades), deferment of all merit-based salary increments, and leave without pay
for three months starting May.

 Because of these decisions, IndiGo believes that it will save 25 per cent on the employees'
expenses for the full year.

INDIGO
• InterGlobe Aviation, the parent company of IndiGo, reported a staggering loss of ₹3,174 crore for the first quarter
of fiscal 2022 as compared to ₹2,842 crore in the same period a year ago. 
• Given the airline’s strong balance sheet—with total cash reserves of Rs 17,067 crore, including free cash of ₹5,620
crore—it continues to evaluate “the timing and the size" of a potential qualified institutional placement (QIP).

• IndiGo is operating 583 flights a day while other airlines such as Air India, Alliance Air, Vistara, AirAsia India and
GoAir are operating less than 100 daily flights each.
• IndiGo is the only carrier that has cash reserves of Rs 18,450 crore as of June 30, 2020. All other carriers, including
Air India, are in a bad financial position.
• IndiGo airlines also continued to offer services for all of the ipl teams and even gained popularity.
• During takeoff, the aircraft pilot gave specifications regarding the flight concerning that of MI. He connected the
details to a few of the MI players.
• Eg: “As per the flight details, we are flying, cruising at 3,000 feet above sea level. Flight will be maintaining a
ground speed of about 900 km/h. That gives us about 45 minutes before we land at our destination. That's just the
time Kieron Pollard needs to score a century”,
  The low-cost carrier’s massive fleet size, as well as expansive routes, are expected to protect its huge domestic
market share. It operates over 1,200 daily flight.

POST PANDEMIC  IndiGo can quickly add more aircraft as it can expedite induction by around 5 planes per month. However, its
fleet has only narrow body aircraft that restrict operational reach.
PROSPECTS –
IndiGo vs Air India

 A combine of Air India-Tata will have Air India’s 117 wide-body and narrow
body aircraft and Air India Express’s 24.
 The wide-body aircraft, trained crews, invaluable airport slots, and time-
tested operational standards, gives the edge to the combine in terms of
ferrying international passenger traffic.

CONCLUSION
 While the Tata Group will have the advantage of a better diversity in its
aircraft fleet, it will be important for them to streamline the consolidated
operations and derive the necessary synergies to be cost competitive.
 Post pandemic, the airline recovery has been erratic. Indigo, with its relatively
stronger finances will retain its market share in the medium term while the
other players rebuild their operations.
THANK
YOU