Air India’s incoming CEO looks at merger of budget unit

Air India’s board met to discuss operational priorities and remuneration for incoming CEO Tewolde Gebremariam. Outgoing CEO Campbell Wilson presented the airline’s current operational position and progress made.

Air India’s incoming CEO Tewolde Gebremariam is considering folding the no-frills Air India Express unit into the group as he tries to cut costs to counter record losses, according to people familiar with the matter.In multiple meetings across departments, Tewolde quizzed managers about the need to run two airline companies with separate operating permits, said the people, who asked not to be identified as the talks were private. The CEO-designate argued that having a single airline group would lower regulatory requirements and reduce the need for two sets of managers, engineers, and administrative staff, the people said.The idea of combining Air India and its budget carrier is at an early stage, and realising it would require approval from the supervisory board, the people said. Air India Express would keep its brand name in a combination, they added. An Air India spokesperson did not respond to an email seeking comments.The deliberations show Tewolde’s eagerness to weed out inefficiencies.(This is a Bloomberg story)