Air India braces for worst annual loss of '15,000cr after crash

Air India is set to report a record annual loss after last year's crash and airspace shutdowns wiped out progress toward a turnaround, according to people familiar with the matter.

The carrier, which is a joint venture between the Tata Group and Singapore Airlines, is on track to post a loss of at least Rs 15,000 crore ($1.6 billion) this fiscal year, said the people. Earnings were further hit by Pakistan's closure of its airspace for Indian airlines following Operation Sindoor, forcing carriers to fly longer routes at higher costs to Europe and the US, they added.

The reversal is especially stark because Air India had been edging back toward profitability before the June Dreamliner crash - which killed more than 240 people - undid years of progress. The founders had targeted operational break-even this fiscal year, but profitability is now out of reach, the people said.

The losses come on the back of a turbulent year for Indian aviation marked by flier anxiety, flight delays and mass cancellations by rival carrier IndiGo, that has put a spotlight on the duopolistic market structure. Spokespersons for Air India, Tata Group and Singapore Airlines did not respond to request for comments. A new five-year plan submitted by management projected profits only in its third year, but it was rejected by the board.

Bloomberg