AirAsia India is again in the news, with reports now suggesting its CEO and MD Mittu Chandilya has resigned. Just a few days back, the airline made headlines for a different reason - when Tata Sons picked up additional equity stake to finally own about 41% share in the airline. Though both these developments are significant, what needs to be highlighted is the deeper rot within the airline.
AirAsia India needs renewed commitment from its shareholders, an urgent funds' infusion and a clear operational strategy to survive in a tough-as-nails Indian aviation market. India is unlike most other markets where airlines pile up losses but rarely folds up, making life quite tough for new entrants.
Vijay Mallya finally ended his airline dream after sinking millions of dollars in the business in Kingfisher Airlines, Air India continues on government dole despite massive accumulated losses, SpiceJet was very close to shutting down before former promoter Ajay Singh rescued it last January and Jet Airways is only now starting to make a turnaround.
What AirAsia India needs the most is commitment from its shareholders towards recapitalization and then a capable management team to steer it. Besides, the airline must be run from India, by a strong management team aware of market realities and clued into the dynamics here instead of being driven from the Malaysian parent's headquarters.