Singapore’s Air India runway promises profit, potholes

For decades, Singapore Airlines has wanted to take pole position in India, tipped to be the world’s third-largest aviation market by the middle of the decade, if not sooner. Now that the opportunity to be a 25% owner of the nation’s largest international and second-largest local carrier has come knocking, CE Goh Choon Phong is happy to write a US$250m cheque. But India’s siren song can also be treacherous. Its heavily regulated sectors, such as telecommunications and aviation, have a history of being unpredictable. Singapore Telecommunications Ltd got lucky in its choice of partner. Bharti Airtel Ltd remains a solid No. 2 in the Indian wireless market after years of intense upheaval. Goh would hope for the same stability from his partner, the 154-year-old Tata Group – perhaps even more, given the aviation industry’s natural tendency to destroy capital. All that’s in the future, though. Right now, it’s handshake time. Vistara, a joint venture of the Tata Group and SIA, is being merged with Air India. The loss-making national carrier went to the local conglomerate when New Delhi sold it last year. Now, Tata will hold 74.9% of the merged entity; Singapore Air will fork out a little over US$250m for 25.1%. An expansion is also on the cards. Air India CEO Campbell Wilson – a Singapore Air veteran – wants to triple his fleet in five years. That purchase, among the most aggressive in the industry after the pandemic, may increase SIA’s investment by another US$615m. Story has more.<br/>