New Delhi:
Air India is reworking its roadmap to profitability, with the Tata Group-owned airline now expected to turn profitable only three to four years from now, as it navigates multiple operational and financial headwinds, according to sources.
The sources said Air India is likely to report a loss exceeding ₹15,000 crore in the current financial year ending March 31, 2026, underscoring the mounting pressure on the airline despite its ongoing transformation under the Vihaan.AI plan.
Headwinds Derail Original Turnaround Timeline
Air India, jointly owned by Tata Group and Singapore Airlines, is in the midst of an ambitious five-year transformation programme launched in September 2022, around eight months after its privatisation.
However, developments such as the closure of Pakistan’s airspace and the fatal Boeing 787 Dreamliner crash in June 2025 have significantly strained the airline’s finances, forcing management to reassess the original profitability timeline.
While the Vihaan.AI plan had envisaged Air India returning to profitability within five years, sources said the airline is now preparing a revised strategy, with profitability likely to be achieved only in the next three to four years amid continued uncertainties.
Queries sent to Air India, Tata Sons and Singapore Airlines seeking comments on the revised plan did not receive any response.
Losses Widen Across Full-Service And Low-Cost Arms
In the financial year ended March 31, 2025, Air India and Air India Express together reported a combined loss before tax of ₹9,568.4 crore, according to data shared by the civil aviation ministry in Parliament.
- Air India (full-service) posted a loss before tax of ₹3,890.2 crore
- Air India Express, which had remained profitable for several years, recorded a loss of ₹5,678.2 crore in FY25
The losses reflect rising costs, operational disruptions and weaker-than-expected demand recovery in certain markets.
Pakistan Airspace Closure Hits Operations Hard
The ongoing Pakistan airspace closure has emerged as a major financial drag, particularly for Air India’s Europe and North America routes.
The airline has been forced to operate longer flight paths, leading to:
- Higher fuel consumption
- Longer flight durations
- Increased operating expenses
In October last year, Air India CEO and Managing Director Campbell Wilson estimated that the airspace restrictions alone could result in a loss of around ₹4,000 crore, while also pointing to broader global uncertainties affecting travel demand.
Dreamliner Crash Adds To Financial Strain
On June 12, 2025, an Air India Boeing 787-8 Dreamliner operating from Ahmedabad to London Gatwick crashed shortly after take-off, killing 260 people, including 241 passengers and crew onboard.
The tragedy has led to substantial additional costs for the airline, including compensation, legal expenses and operational disruptions, further weighing on its financial performance.
Vihaan.AI Vision Remains Intact, But Timelines Shift
When unveiling the Vihaan.AI plan in 2022, Air India had described it as a clear, milestone-driven roadmap aimed at restoring the airline’s competitiveness.
“Over the next five years, Air India will strive to increase its domestic market share to at least 30 per cent while significantly expanding its international presence. The plan is aimed at sustained growth, profitability and market leadership,” the airline had said at the time.
While the vision remains unchanged, industry watchers say execution challenges and external shocks have delayed the financial turnaround.
Fleet Revamp Continues Despite Losses
Even as losses persist, Air India is pressing ahead with a major fleet modernisation drive. The airline currently operates around 190 aircraft and earlier this month took delivery of its first Boeing 787-9 Dreamliner since privatisation.
Over the coming years, Air India is set to induct more than 570 new aircraft, a move expected to improve efficiency, passenger experience and long-term competitiveness.