Analyze the journey of SINGAPORE airlines since they entered Indian market?

Tata Sons, the holding company of Tata Group formed joint

venture with Singapore airlines on 19 September 2013 to lunch
AIR VISTARA, with an initial investment of $100 million. The
shareholding stake for Tata Sons is 51% while the rest is owned
by Singapore Airlines.

TATA SIA Airlines Limited is an Indian full-service airline based in

Gurugram with its hub at Indira Gandhi International Airport.
Since 9 January 2015 when the company commenced its
operations, it has now emerged to have a 4.7% share in
domestic carrier market making it the 6th largest domestic
airline.

Singapore Airlines chose Airbus A320 and Boeing 737-800NG aircraft to operate 87 weekly flights during
the first year of its operation In India. The major cities that the airline decided to cover were Delhi,
Mumbai, Bangalore, Ahmedabad and Hyderabad. Now as of 11 July 2019 Vistara has announced their
first International Destination to be Singapore from Delhi and Mumbai using Boeing 737-800NG aircraft.

While Vistara had been growing at quite a fast rate since its operational working in 2015, it certainly has
faced some challenges to survive in the Indian market. Even though Vistara had been the first airline in
India to introduce Premium Economy Class in the domestic market, it certainly had to re-configure its
aircraft. From having 16 Business class, 36 Premium Economy and 96 Economy class seats in the first
year; it went down to re-allocation of seats to accommodate a greater number of economy class
travelers. The size of business class was cut off by 50 per cent while premium economy also faced a
downfall f 12 seats. Furthermore, 30 more seats were added in the economy class department to fulfill
the growing needs of the passengers. A 33% drop in Business class seats undoubtedly gives a fair idea of
continuous reduction in profits for the airline.

Moreover, with increasing losses the airline is adamant on investing money in robot which merely scans
the boarding pass and tells the gate, which can also be availed through Fight Information Display
system. In the time of need to rationally use the limited revenue to generate more profits, cut costs and
give secondary importance to technological advancement; Vistara’s strategies seem to work on virtual
gains.

It is well known fact that Indian market works on wafer-thin margins and surveying the decline of
competitive airlines, it is high time that Vistara should start upgrading the profitability and not just some
increase in revenue.