Tata Sons just won the bid for ownership of Air India in a full-circle moment - see the airline's 89-year history

Taylor RainsOct 12, 2021, 00:44 IST

Tata Airlines 747Tata.com

Tata Sons won a 100% stake in Air India, having bid $2.4 billion for the debt-ridden airline.
Tata will take on $3.1 billion in debt but maintain Air India's brand and assets.

Air India dates back to 1932, when it was founded as a private entity by renowned industrialist and philanthropist JRD Tata. Tata was India's first private pilot and his fascination with the industry led him to create the country's first commercial airline.

JRD Tata's pilot license Tata.com

Air India dates back to 1932, when it was founded as a private entity by renowned industrialist and philanthropist JRD Tata. Tata was India's first private pilot and his fascination with the industry led him to create the country's first commercial airline.

While Tata is given credit for founding the airline, it was actually World War I veteran pilot Nevill Vintcent who came up with the idea. In 1928, Vintcent heard Britain's Imperial Airways was going to start international service across to Australia, and Air France and KLM were going to follow with flights to Vietnam and Indonesia.

Imperial Airways aircraft Graham Ashby/Shutterstock

While Tata is given credit for founding the airline, it was actually World War I veteran pilot Nevill Vintcent who came up with the idea. In 1928, Vintcent heard Britain's Imperial Airways was going to start international service across to Australia, and Air France and KLM were going to follow with flights to Vietnam and Indonesia.

The European airlines planned to carry both passengers and mail. Mail would be dropped off in Karachi, Pakistan and India-bound parcels would be transported to the country via rail - a process that could take a few days.

India locomotive mail stamp rook76/Shutterstock

The European airlines planned to carry both passengers and mail. Mail would be dropped off in Karachi, Pakistan and India-bound parcels would be transported to the country via rail - a process that could take a few days.

Having carried mail as a pilot in Malaysia, Vintcent realized he could speed the process up by flying the mail from Pakistan to India instead. His domestic airmail service idea involved picking up the mail in Karachi and transporting it to cities in India within 24 hours. The concept also allowed for passenger service.

Airmail postage stamp India Postage Stamps

Having carried mail as a pilot in Malaysia, Vintcent realized he could speed the process up by flying the mail from Pakistan to India instead. His domestic airmail service idea involved picking up the mail in Karachi and transporting it to cities in India within 24 hours. The concept also allowed for passenger service.

Because Vintcent did not have the resources to start an airline, he reached out to investors. He started by pitching to leading Parsi industrialist Sir Homi Mehta. While Mehta said he was not interested, he suggested Vintcent talk to Sir Dorabji Tata.

Sir Dorabji Tata (seated on right) Tata.com

Because Vintcent did not have the resources to start an airline, he reached out to investors. He started by pitching to leading Parsi industrialist Sir Homi Mehta. While Mehta said he was not interested, he suggested Vintcent talk to Sir Dorabji Tata.

Tata was skeptical of Vintcent's idea, but his prodigy and aviation buff nephew, JRD Tata, convinced him to pursue the venture. Thus, with an Rs2 lakh ($2,661) investment, Tata Air Mail was born. The purchasing power of $2,661 in 1928 is about $42,500 today.

Portrait of JRD Tata Hindustan Times/Getty Images

Tata was skeptical of Vintcent's idea, but his prodigy and aviation buff nephew, JRD Tata, convinced him to pursue the venture. Thus, with an Rs2 lakh ($2,661) investment, Tata Air Mail was born. The purchasing power of $2,661 in 1928 is about $42,500 today.

The Tatas purchased two single-engined De Havilland Puss Moth aircraft to run the operation and named Vintcent as the chief pilot. Vintcent worked as a full-time pilot for the airline, but Tata also employed two part-time pilots, one part-time engineer, and a handful of apprentice mechanics.

De Havilland Puss Moth (not Tata Air Mail) Kev Gregory/Shutterstock

The Tatas purchased two single-engined De Havilland Puss Moth aircraft to run the operation and named Vintcent as the chief pilot. Vintcent worked as a full-time pilot for the airline, but Tata also employed two part-time pilots, one part-time engineer, and a handful of apprentice mechanics.

Tata Air Mail aircraft could fly about 80 miles per hour and carried mail and up to two passengers. To navigate, Vintcent would follow the rail tracks below and, if needed, use a slide-rule navigation tool he kept in his pocket.

Pilot slide-rule vadimserebrenikov/Shutterstock

Tata Air Mail aircraft could fly about 80 miles per hour and carried mail and up to two passengers. To navigate, Vintcent would follow the rail tracks below and, if needed, use a slide-rule navigation tool he kept in his pocket.

JRD created the airline's memorable motto, "Mail may be lost but never delayed; passengers may be delayed but never lost."

Air mail from India Susan Law Cain/Shutterstock

The company's maiden flight launched on October 15, 1932, marking the first flight in Indian aviation history. JRD Tata famously flew the first leg from Karachi to Bombay where Vintcent was waiting with the second aircraft. Vintcent then flew from Bombay to Madras.

Tata Air Mail's inaugural flight Tata.com

The company's maiden flight launched on October 15, 1932, marking the first flight in Indian aviation history. JRD Tata famously flew the first leg from Karachi to Bombay where Vintcent was waiting with the second aircraft. Vintcent then flew from Bombay to Madras.

"On an exciting October dawn in 1932, a Puss Moth and I soared joyfully from Karachi with our first precious load of mail, on an inaugural flight to Bombay," JRD recalled.

Tata Airlines time table Bjorn Larsson

"On an exciting October dawn in 1932, a Puss Moth and I soared joyfully from Karachi with our first precious load of mail, on an inaugural flight to Bombay," JRD recalled.

Tata Air Mail was headquartered in a shed on a mud airfield in the beach town of Juhu, India, which kept getting battered by monsoons. The company was forced to move its operation to Pune after Juhu fell below sea level after each storm.

Juhu, India coastline and runway Hitman H/Shutterstock

Tata Air Mail was headquartered in a shed on a mud airfield in the beach town of Juhu, India, which kept getting battered by monsoons. The company was forced to move its operation to Pune after Juhu fell below sea level after each storm.

After one year of operation, Tata carried 10 tons of mail and 155 fearless passengers, resulting in an Rs 60,000 ($799) profit.

Tata Airlines route booklet Bjorn Larsson

Tata Air Mail had an outstanding first year, with the Directorate of Civil Aviation noting in his 1933 annual report that the airline had a 100% on-time record "even during the most difficult monsoon months." He also took a stab at Imperial Airways, suggesting it "might send its staff to Tatas to see how it's done."

Tata Airlines timetable Bjorn Larsson

Tata Air Mail had an outstanding first year, with the Directorate of Civil Aviation noting in his 1933 annual report that the airline had a 100% on-time record "even during the most difficult monsoon months." He also took a stab at Imperial Airways, suggesting it "might send its staff to Tatas to see how it's done."

Over the next five years, the company continued to expand. It started flying to Delhi, Hyderabad, Goa, Trivandrum, Trichy, and Colombo. It also upgraded its aircraft to a Miles Merlin, which could ferry more passengers. With the airline becoming more sophisticated, it officially changed its name to Tata Airlines in 1938.

Miles Merlin (not Tata Airlines) Tim Mason

Over the next five years, the company continued to expand. It started flying to Delhi, Hyderabad, Goa, Trivandrum, Trichy, and Colombo. It also upgraded its aircraft to a Miles Merlin, which could ferry more passengers. With the airline becoming more sophisticated, it officially changed its name to Tata Airlines in 1938.

However, World War II proved to be a major disruption for Tata Airlines as the Indian government had the carrier flying Royal Air Force troops and military supplies.

Royal Air Force aircraft Everett Collection/Shutterstock

But Tata and Vintcent saw a different path to help the war effort - aircraft manufacturing. The pair's experience in the industry plus the Tata's resources made the concept possible, so Vintcent and Tata submitted a proposal to the British government to establish Tata Aircraft in Pune, India. The company planned to mass-produce the De Havilland Mosquito bomber.

WWII-era mosquito bomber BlueBarronPhoto/Shutterstock

But Tata and Vintcent saw a different path to help the war effort - aircraft manufacturing. The pair's experience in the industry plus the Tata's resources made the concept possible, so Vintcent and Tata submitted a proposal to the British government to establish Tata Aircraft in Pune, India. The company planned to mass-produce the De Havilland Mosquito bomber.

Britain approved the venture, but by the time the manufacturing plant was set up, the war had shifted and the RAF no longer needed bombers, it needed gliders. Vintcent flew to Britain to discuss the change of plans, but disaster struck on his return home to India.

World War II airspeed Horsa glider Royal Air Force

Britain approved the venture, but by the time the manufacturing plant was set up, the war had shifted and the RAF no longer needed bombers, it needed gliders. Vintcent flew to Britain to discuss the change of plans, but disaster struck on his return home to India.

Vintcent was originally planned to fly on Imperial Airways, but avoiding German airspace made the journey longer than normal, so Vintcent finagled his way onto an RAF bomber to get him to India quicker. Unfortunately, the plane was shot down and Vintcent perished.

Lancaster bomber speedimaging/Shutterstock

Vintcent was originally planned to fly on Imperial Airways, but avoiding German airspace made the journey longer than normal, so Vintcent finagled his way onto an RAF bomber to get him to India quicker. Unfortunately, the plane was shot down and Vintcent perished.

JRD Tata was devastated by Vintcent's passing because without his original concept, experience, and charisma, Tata Airlines may have never been born. Fortunately, Tata pushed through the tragedy and continued to build the airline.

Tata Airlines Tata.com

JRD Tata was devastated by Vintcent's passing because without his original concept, experience, and charisma, Tata Airlines may have never been born. Fortunately, Tata pushed through the tragedy and continued to build the airline.

After the war in 1946, Tata's full scheduled service was restored and it became a public company listed as Air India. The company also created its infamous Maharajah mascot, which is used to promote its services.

Air India Maharajah PhotographerIncognito/Shutterstock

After the war in 1946, Tata's full scheduled service was restored and it became a public company listed as Air India. The company also created its infamous Maharajah mascot, which is used to promote its services.

Furthermore, the company purchased a fleet of aircraft, including the infamous Lockheed Super Constellation named "Malabar Princess," which was capable of international flights.

Malabar Princess Mila Daniels/Planes.cz

Furthermore, the company purchased a fleet of aircraft, including the infamous Lockheed Super Constellation named "Malabar Princess," which was capable of international flights.

However, things started to change in 1947 when, after Indian independence, the government started talks of the nationalization of many companies, including Tata Airlines. JRD opposed the idea saying nationalization would lead to bureaucracy, a decrease in employee morale, and a worse passenger experience.

Indian independence illustration Vectomart/Shutterstock

However, things started to change in 1947 when, after Indian independence, the government started talks of the nationalization of many companies, including Tata Airlines. JRD opposed the idea saying nationalization would lead to bureaucracy, a decrease in employee morale, and a worse passenger experience.

Nevertheless, the government took a 49% stake in the company in 1948, creating Air India International. Tata held a 25% stake with the rest under public ownership. However, this didn't stop JRD Tata from pushing forward.

Air India aircraft CAMFOTO049/Shutterstock

Nevertheless, the government took a 49% stake in the company in 1948, creating Air India International. Tata held a 25% stake with the rest under public ownership. However, this didn't stop JRD Tata from pushing forward.

In the same year, the Malabar Princess took off on its first international flight on June 8, 1948, ferrying 35 passengers, including JRD Tata, from Bombay to London. The flight cost Rs 1,720 ($23, which is $261 today). "Set your watches, boys, we are right on schedule," Tata said to the media as he stepped off the plane.

Lockheed Super Constellation (not Air India) IanC66/Shutterstock

In the same year, the Malabar Princess took off on its first international flight on June 8, 1948, ferrying 35 passengers, including JRD Tata, from Bombay to London. The flight cost Rs 1,720 ($23, which is $261 today). "Set your watches, boys, we are right on schedule," Tata said to the media as he stepped off the plane.

After five years of split ownership, JRD Tata received a major blow in 1953 when the Indian government nationalized Air India, stripping Tata of control. Tata was distraught, saying it was the government's attempt to suppress civil air services.

A stock image of an Air India jet in Mumbai, May 2020 Indranil Mukherjee / AFP via Getty Images

After five years of split ownership, JRD Tata received a major blow in 1953 when the Indian government nationalized Air India, stripping Tata of control. Tata was distraught, saying it was the government's attempt to suppress civil air services.

While the government took power from Tata, it still wanted his expertise to help run the airline. So, officials proposed Tata become Air India's chairman and be on the board for Indian Airlines, which operated Air India's domestic service. Tata accepted the offer.

Air India aircraft Media_works/Shutterstock

While the government took power from Tata, it still wanted his expertise to help run the airline. So, officials proposed Tata become Air India's chairman and be on the board for Indian Airlines, which operated Air India's domestic service. Tata accepted the offer.

In February 1960, Air India became the first Asian country to enter the jet age with the purchase of a Boeing 707-420 aircraft. The company launched the plane on a flight to New York. Two years later, Air India became the world's first all-jet airline.

Air India Boeing 707 Steve Fitzgerald/Airliners.net

In February 1960, Air India became the first Asian country to enter the jet age with the purchase of a Boeing 707-420 aircraft. The company launched the plane on a flight to New York. Two years later, Air India became the world's first all-jet airline.

In 1970, the carrier moved its headquarters to downtown Bombay, and in 1971, it received its first Boeing 747-200B aircraft, named "Emperor Ashoka."

Tata Airlines 747 Tata.com

The same year, the company introduced its new "Palace in the Sky" livery and branding. The company was focused on bringing the Indian culture to the inflight experience with colorful designs and a welcoming cabin crew.

Tata Airlines inflight Tata.com

The same year, the company introduced its new "Palace in the Sky" livery and branding. The company was focused on bringing the Indian culture to the inflight experience with colorful designs and a welcoming cabin crew.

The airline became known as one of the world's finest airlines. For example, before Air India had an all-jet fleet, it competed with British Overseas Airways Corporation on a route using a turboprop. Despite BOAC using a jet on the same route, passengers still opted for Air India's longer flight because of how pampered they were onboard.

BA 747 painted in BOAC livery Ceri Breeze/Shutterstock

The airline became known as one of the world's finest airlines. For example, before Air India had an all-jet fleet, it competed with British Overseas Airways Corporation on a route using a turboprop. Despite BOAC using a jet on the same route, passengers still opted for Air India's longer flight because of how pampered they were onboard.

Meanwhile, its most luxurious routes were transatlantic, where it happily stole customers from its European and American competitors. The aircraft offered bar service in first class, onboard meals, and magazines.

Air India 747 w_p_o/Shutterstock

Meanwhile, its most luxurious routes were transatlantic, where it happily stole customers from its European and American competitors. The aircraft offered bar service in first class, onboard meals, and magazines.

Also accessible onboard was the Maharaja Lounge in the 747s upper deck, which JRD Tata helped design. He ensured everything from the napkins to the tableware was created in his vision.

Tata Airlines Tata.com

Also accessible onboard was the Maharaja Lounge in the 747s upper deck, which JRD Tata helped design. He ensured everything from the napkins to the tableware was created in his vision.

In 1978, JRD Tata's position as chairman of Air India came into question after Air India's first 747, Emperor Ashoka, crashed off the coast of Bombay, killing 213 passengers and crew. The crash was due to pilot error, and the then-Prime Minister of India stripped Tata from his chairman and board position of Air India and Indian Airlines.

Air India 747 named Emperor Ashoka Michel Gilliand/Airliners.net

In 1978, JRD Tata's position as chairman of Air India came into question after Air India's first 747, Emperor Ashoka, crashed off the coast of Bombay, killing 213 passengers and crew. The crash was due to pilot error, and the then-Prime Minister of India stripped Tata from his chairman and board position of Air India and Indian Airlines.

However, another driving issue between the two was the Prime Minister saying no alcohol could be served on Air India, but JRD Tata strongly opposed it. Tata's firing received national outrage because Air India was a symbol of national pride for the people.

Air India seats EQRoy/Shutterstock

However, another driving issue between the two was the Prime Minister saying no alcohol could be served on Air India, but JRD Tata strongly opposed it. Tata's firing received national outrage because Air India was a symbol of national pride for the people.

Fortunately, Tata was reinstated in 1980 by Prime Minister Indira Gandhi to the board of both airlines, where he served until 1986.

Prime Minister Indira Gandhi United States Library of Congress

Air India continued to expand its fleet over the next decade, taking delivery of its first Airbus A310-300 in 1986 and its first Boeing 747-400 in 1993, which is named Konark. Konark flew the first nonstop flight between Delhi and New York that year.

Air India Airbus A300 Perry Hoppe/Airliners.net

Air India continued to expand its fleet over the next decade, taking delivery of its first Airbus A310-300 in 1986 and its first Boeing 747-400 in 1993, which is named Konark. Konark flew the first nonstop flight between Delhi and New York that year.

In 1995, Air India began serving Amsterdam from Mumbai, in 1996 it entered Chicago O'Hare, and in 1997 it entered a global alliance with Air France. However, in the mid-1990s, private players started entering the industry with lower fares, causing Air India to lose part of its market share.

Airbus A318 Air France Archivio Massimo Insabato/Mondadori Portfolio via Getty Images

In 1995, Air India began serving Amsterdam from Mumbai, in 1996 it entered Chicago O'Hare, and in 1997 it entered a global alliance with Air France. However, in the mid-1990s, private players started entering the industry with lower fares, causing Air India to lose part of its market share.

From 2000-2001, Air India attempted to re-privatize. The National Democratic Alliance government tried to sell a 40% stake in the company, which Tata and Singapore Airlines showed interest in buying. However, Singapore pulled out after opposition from trade unions, dismantling the investment plan.

A Singapore Airlines Boeing 777-300ER. Thiago B Trevisan/Shutterstock.com

From 2000-2001, Air India attempted to re-privatize. The National Democratic Alliance government tried to sell a 40% stake in the company, which Tata and Singapore Airlines showed interest in buying. However, Singapore pulled out after opposition from trade unions, dismantling the investment plan.

In 2004, Air India entered into an alliance with Lufthansa.

A Lufthansa Airbus A321. Nicolas Economou/NurPhoto/Getty

The same year, the company launched its wholly-owned subsidiary, Air India Express, which connected India with the Middle East and Southeast Asia.

Philip Lange / Shutterstock.com

In 2007, Air India merged with Indian Airlines to create Air India Limited. Up until then, Air India operated most long-haul international routes while Indian Airlines ran its short-haul international and domestic network.

Air India Vytautas Kielaitis/Shutterstock

In 2007, Air India merged with Indian Airlines to create Air India Limited. Up until then, Air India operated most long-haul international routes while Indian Airlines ran its short-haul international and domestic network.

Also in 2007, the airline received its first Boeing 777 aircraft and was invited to be a part of the Star Alliance, which included carriers like Lufthansa and United Airlines.

Air India Star Alliance livery Phuong D. Nguyen/Shutterstock

Also in 2007, the airline received its first Boeing 777 aircraft and was invited to be a part of the Star Alliance, which included carriers like Lufthansa and United Airlines.

Since its merger, Air India has not turned a profit. In 2007, it posted a net loss of Rs 7.7 billion ($102 million), which increased to Rs 72 billion ($1 million) by 2009.

Air India Boeing 787 Media_works/Shutterstock

Since its merger, Air India has not turned a profit. In 2007, it posted a net loss of Rs 7.7 billion ($102 million), which increased to Rs 72 billion ($1 million) by 2009.

To finance the debt, Air India sold three of its Airbus A300s and one Boeing 747 for Rs 1.4 billion ($18.75 million). The carrier was Rs 426 billion ($6 billion) in debt by 2011, and its invitation to join Star Alliance was suspended the same year due to it failing to meet membership requirements.

Air India Boeing 747 Renatas Repcinskas/Shutterstock

To finance the debt, Air India sold three of its Airbus A300s and one Boeing 747 for Rs 1.4 billion ($18.75 million). The carrier was Rs 426 billion ($6 billion) in debt by 2011, and its invitation to join Star Alliance was suspended the same year due to it failing to meet membership requirements.

In 2012, the Indian government sent Rs 32 billion ($450 million) to Air India in a bailout and a financial restructuring plan was approved. Also that year, a study by the Corporate Affairs Ministry concluded the airline should be partly private, so Air India invited banks to raise up to Rs 60 billion ($800 million).

Indian Bank TK Kurikawa/Shutterstock

In 2012, the Indian government sent Rs 32 billion ($450 million) to Air India in a bailout and a financial restructuring plan was approved. Also that year, a study by the Corporate Affairs Ministry concluded the airline should be partly private, so Air India invited banks to raise up to Rs 60 billion ($800 million).

The airline continued to try to privatize in 2013 but had strong opposition from rival government parties. However, that same year, Air India posted its first positive earnings before taxes in six years and had a 20% growth in operating revenue.

Air India aircraft Tooykrub/Shutterstock

The airline continued to try to privatize in 2013 but had strong opposition from rival government parties. However, that same year, Air India posted its first positive earnings before taxes in six years and had a 20% growth in operating revenue.

Then, in 2014, Air India solidified its spot as a Star Alliance member. In 2015, the company signed an agreement with Citibank and the State Bank of India to pump $300 million into the airline. Nevertheless, the airline saw a net loss that year.

Air India 787 Star Alliance livery KITTIKUN YOKSAP/Shutterstock

Then, in 2014, Air India solidified its spot as a Star Alliance member. In 2015, the company signed an agreement with Citibank and the State Bank of India to pump $300 million into the airline. Nevertheless, the airline saw a net loss that year.

In 2017, the Indian government approved the privatization of Air India. In 2018, the government wanted to sell a 76% stake in the airline, with the condition it takes on $4.7 billion of Air India's debt. The remaining 24% would remain in government control, however, it secured no buyers.

Air India aircraft at Mumbai airport Anand Balaji/Shutterstock

In 2017, the Indian government approved the privatization of Air India. In 2018, the government wanted to sell a 76% stake in the airline, with the condition it takes on $4.7 billion of Air India's debt. The remaining 24% would remain in government control, however, it secured no buyers.

In 2019, the government upped the ante. It released an Express of Interest to sell a 100% stake in the debt-ridden airline and its subsidiary Air India Express, as well as 50% in AISATS, a ground handling company. It attracted a handful of bidders, including Tata Sons and a consortium led by Spice Jet's chairman and managing director Ajar Singh.

Boeing

In 2019, the government upped the ante. It released an Express of Interest to sell a 100% stake in the debt-ridden airline and its subsidiary Air India Express, as well as 50% in AISATS, a ground handling company. It attracted a handful of bidders, including Tata Sons and a consortium led by Spice Jet's chairman and managing director Ajar Singh.

On October 8, 2021, Tata Sons won the bid with Rs 18,000 crore ($2.4 billion). The win will give Tata ownership of the Air India, Indian Airlines, and Maharajah brands, as well as airport slots at 173 destinations worldwide and 141 planes.

Air India seats Santhosh Varghese/Shutterstock

On October 8, 2021, Tata Sons won the bid with Rs 18,000 crore ($2.4 billion). The win will give Tata ownership of the Air India, Indian Airlines, and Maharajah brands, as well as airport slots at 173 destinations worldwide and 141 planes.

Tata will take on Rs 23,286.5 crore ($3.1 billion) of Air India's Rs 60,074 crone ($8 billion). The remaining debt will be put into a Special Purpose Vehicle, Air India Assets Holding Ltd, to monetize the airline's assets to pay off the debt.

Air India Boeing 777 Lukas Wunderlich/Shutterstock

Tata will take on Rs 23,286.5 crore ($3.1 billion) of Air India's Rs 60,074 crone ($8 billion). The remaining debt will be put into a Special Purpose Vehicle, Air India Assets Holding Ltd, to monetize the airline's assets to pay off the debt.

Tata Sons' winning bid for ownership of Air India brings the history of the airline full circle. Eighty-nine years after founding the airline, Tata regained control once again.

JRD Tata with De Havilland Leopard Moth aircraft Tata.com

Tata Sons' winning bid for ownership of Air India brings the history of the airline full circle. Eighty-nine years after founding the airline, Tata regained control once again.

"On an emotional note, Air India under the leadership of Mr JRD Tata had, at one time, gained the reputation of being one of the most prestigious airlines in the world. Tata will have the opportunity of regaining the image and reputation it enjoyed in earlier years. Mr JRD Tata would have been overjoyed if he was in our midst today," said Tata Group's chairman emeritus Ratan Tata.

JRD Tata Tata.com

"On an emotional note, Air India under the leadership of Mr JRD Tata had, at one time, gained the reputation of being one of the most prestigious airlines in the world. Tata will have the opportunity of regaining the image and reputation it enjoyed in earlier years. Mr JRD Tata would have been overjoyed if he was in our midst today," said Tata Group's chairman emeritus Ratan Tata.

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Tata Sons just won the bid for ownership of Air India in a full-circle moment - see the airline's 89-year history

Air India dates back to 1932, when it was founded as a private entity by renowned industrialist and philanthropist JRD Tata. Tata was India's first private pilot and his fascination with the industry led him to create the country's first commercial airline.

The European airlines planned to carry both passengers and mail. Mail would be dropped off in Karachi, Pakistan and India-bound parcels would be transported to the country via rail - a process that could take a few days.

Because Vintcent did not have the resources to start an airline, he reached out to investors. He started by pitching to leading Parsi industrialist Sir Homi Mehta. While Mehta said he was not interested, he suggested Vintcent talk to Sir Dorabji Tata.

Tata was skeptical of Vintcent's idea, but his prodigy and aviation buff nephew, JRD Tata, convinced him to pursue the venture. Thus, with an Rs2 lakh ($2,661) investment, Tata Air Mail was born. The purchasing power of $2,661 in 1928 is about $42,500 today.

The Tatas purchased two single-engined De Havilland Puss Moth aircraft to run the operation and named Vintcent as the chief pilot. Vintcent worked as a full-time pilot for the airline, but Tata also employed two part-time pilots, one part-time engineer, and a handful of apprentice mechanics.

Tata Air Mail aircraft could fly about 80 miles per hour and carried mail and up to two passengers. To navigate, Vintcent would follow the rail tracks below and, if needed, use a slide-rule navigation tool he kept in his pocket.

JRD created the airline's memorable motto, "Mail may be lost but never delayed; passengers may be delayed but never lost."

The company's maiden flight launched on October 15, 1932, marking the first flight in Indian aviation history. JRD Tata famously flew the first leg from Karachi to Bombay where Vintcent was waiting with the second aircraft. Vintcent then flew from Bombay to Madras.

"On an exciting October dawn in 1932, a Puss Moth and I soared joyfully from Karachi with our first precious load of mail, on an inaugural flight to Bombay," JRD recalled.

Tata Air Mail was headquartered in a shed on a mud airfield in the beach town of Juhu, India, which kept getting battered by monsoons. The company was forced to move its operation to Pune after Juhu fell below sea level after each storm.

After one year of operation, Tata carried 10 tons of mail and 155 fearless passengers, resulting in an Rs 60,000 ($799) profit.

However, World War II proved to be a major disruption for Tata Airlines as the Indian government had the carrier flying Royal Air Force troops and military supplies.

Britain approved the venture, but by the time the manufacturing plant was set up, the war had shifted and the RAF no longer needed bombers, it needed gliders. Vintcent flew to Britain to discuss the change of plans, but disaster struck on his return home to India.

Vintcent was originally planned to fly on Imperial Airways, but avoiding German airspace made the journey longer than normal, so Vintcent finagled his way onto an RAF bomber to get him to India quicker. Unfortunately, the plane was shot down and Vintcent perished.

JRD Tata was devastated by Vintcent's passing because without his original concept, experience, and charisma, Tata Airlines may have never been born. Fortunately, Tata pushed through the tragedy and continued to build the airline.

After the war in 1946, Tata's full scheduled service was restored and it became a public company listed as Air India. The company also created its infamous Maharajah mascot, which is used to promote its services.

Furthermore, the company purchased a fleet of aircraft, including the infamous Lockheed Super Constellation named "Malabar Princess," which was capable of international flights.

Nevertheless, the government took a 49% stake in the company in 1948, creating Air India International. Tata held a 25% stake with the rest under public ownership. However, this didn't stop JRD Tata from pushing forward.

After five years of split ownership, JRD Tata received a major blow in 1953 when the Indian government nationalized Air India, stripping Tata of control. Tata was distraught, saying it was the government's attempt to suppress civil air services.

While the government took power from Tata, it still wanted his expertise to help run the airline. So, officials proposed Tata become Air India's chairman and be on the board for Indian Airlines, which operated Air India's domestic service. Tata accepted the offer.

In February 1960, Air India became the first Asian country to enter the jet age with the purchase of a Boeing 707-420 aircraft. The company launched the plane on a flight to New York. Two years later, Air India became the world's first all-jet airline.

In 1970, the carrier moved its headquarters to downtown Bombay, and in 1971, it received its first Boeing 747-200B aircraft, named "Emperor Ashoka."

The same year, the company introduced its new "Palace in the Sky" livery and branding. The company was focused on bringing the Indian culture to the inflight experience with colorful designs and a welcoming cabin crew.

Meanwhile, its most luxurious routes were transatlantic, where it happily stole customers from its European and American competitors. The aircraft offered bar service in first class, onboard meals, and magazines.

Also accessible onboard was the Maharaja Lounge in the 747s upper deck, which JRD Tata helped design. He ensured everything from the napkins to the tableware was created in his vision.

However, another driving issue between the two was the Prime Minister saying no alcohol could be served on Air India, but JRD Tata strongly opposed it. Tata's firing received national outrage because Air India was a symbol of national pride for the people.

Fortunately, Tata was reinstated in 1980 by Prime Minister Indira Gandhi to the board of both airlines, where he served until 1986.

Air India continued to expand its fleet over the next decade, taking delivery of its first Airbus A310-300 in 1986 and its first Boeing 747-400 in 1993, which is named Konark. Konark flew the first nonstop flight between Delhi and New York that year.

In 1995, Air India began serving Amsterdam from Mumbai, in 1996 it entered Chicago O'Hare, and in 1997 it entered a global alliance with Air France. However, in the mid-1990s, private players started entering the industry with lower fares, causing Air India to lose part of its market share.

From 2000-2001, Air India attempted to re-privatize. The National Democratic Alliance government tried to sell a 40% stake in the company, which Tata and Singapore Airlines showed interest in buying. However, Singapore pulled out after opposition from trade unions, dismantling the investment plan.

In 2004, Air India entered into an alliance with Lufthansa.

The same year, the company launched its wholly-owned subsidiary, Air India Express, which connected India with the Middle East and Southeast Asia.

In 2007, Air India merged with Indian Airlines to create Air India Limited. Up until then, Air India operated most long-haul international routes while Indian Airlines ran its short-haul international and domestic network.

Also in 2007, the airline received its first Boeing 777 aircraft and was invited to be a part of the Star Alliance, which included carriers like Lufthansa and United Airlines.

Since its merger, Air India has not turned a profit. In 2007, it posted a net loss of Rs 7.7 billion ($102 million), which increased to Rs 72 billion ($1 million) by 2009.

To finance the debt, Air India sold three of its Airbus A300s and one Boeing 747 for Rs 1.4 billion ($18.75 million). The carrier was Rs 426 billion ($6 billion) in debt by 2011, and its invitation to join Star Alliance was suspended the same year due to it failing to meet membership requirements.

The airline continued to try to privatize in 2013 but had strong opposition from rival government parties. However, that same year, Air India posted its first positive earnings before taxes in six years and had a 20% growth in operating revenue.

Then, in 2014, Air India solidified its spot as a Star Alliance member. In 2015, the company signed an agreement with Citibank and the State Bank of India to pump $300 million into the airline. Nevertheless, the airline saw a net loss that year.

In 2017, the Indian government approved the privatization of Air India. In 2018, the government wanted to sell a 76% stake in the airline, with the condition it takes on $4.7 billion of Air India's debt. The remaining 24% would remain in government control, however, it secured no buyers.

On October 8, 2021, Tata Sons won the bid with Rs 18,000 crore ($2.4 billion). The win will give Tata ownership of the Air India, Indian Airlines, and Maharajah brands, as well as airport slots at 173 destinations worldwide and 141 planes.

Tata will take on Rs 23,286.5 crore ($3.1 billion) of Air India's Rs 60,074 crone ($8 billion). The remaining debt will be put into a Special Purpose Vehicle, Air India Assets Holding Ltd, to monetize the airline's assets to pay off the debt.

Tata Sons' winning bid for ownership of Air India brings the history of the airline full circle. Eighty-nine years after founding the airline, Tata regained control once again.