Air India braces itself for record US$1.6 billion loss after deadly crash
Despite its founders targeting operational break-even this fiscal year, profitability is now out of reach, sources say
[MUMBAI] Air India is set to report a record annual loss, after a deadly crash and airspace shutdowns in 2025 wiped out progress towards a turnaround, sources said.
The carrier, which is a joint venture between Tata Group and Singapore Airlines (SIA), is on track to post a loss of at least 150 billion rupees (S$2.1 billion) for the year ending Mar 31, they said, asking not to be identified while discussing private information.
Earnings were further hit by Pakistan’s closure of its airspace for Indian airlines following a military clash with the country, forcing carriers to fly longer routes at higher costs to Europe and the US, the sources added.
The reversal is especially stark because Air India was edging back toward profitability before the June Dreamliner crash – which killed more than 240 people – undid years of progress.
The founders targeted operational break-even this fiscal year, but profitability is now out of reach, the sources said.
The losses come on the back of a turbulent year for Indian aviation, marked by flier anxiety, flight delays and mass cancellations by a rival carrier.
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It has put a spotlight on the duopolistic market structure.
Spokespersons for Air India, Tata Group and SIA did not respond to an e-mailed request for comments on the losses.
A new five-year plan submitted by management projected profits only in its third year, but it was rejected by the board, which asked for a more aggressive turnaround push, the sources said.
Government filings compiled by business intelligence platform Tofler show that Air India has lost 322.1 billion rupees over the past three years.
The airline sought at least 100 billion rupees in fresh support in 2025, Bloomberg News reported in October.
The mounting losses are now a concern for both owners. Tata Group has begun scouting for a new CEO to replace Campbell Wilson, though the search might not conclude until the crash report is released.
Earnings for SIA, which took a 25.1 per cent stake after merging Vistara with Air India in 2024, were dragged down by the carrier’s performance.
This was even as the airline helped Air India bring aircraft maintenance in-house, as part of a restructuring plan. BLOOMBERG
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