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Air India braces for final crash report amid financial turmoil
The Aircraft Accident Investigation Bureau (AAIB) is set to release its findings on the June 2025 crash of Air India flight AI-171, which killed all 260 passengers and crew shortly after takeoff from Ahmedabad. The report, expected within weeks, comes as the airline faces a perfect storm of leadership upheaval, financial strain, and operational setbacks.
Leadership vacuum and mounting losses
Air India's CEO, Campbell Wilson, resigned last month as the carrier reported a $2.4 billion loss for the fiscal year ending March 2026. The airline, now the Tata Group's biggest financial liability since its 2022 privatization, has become a growing concern for the conglomerate's board. Local media reported that Tata executives recently discussed cost-cutting measures and warned staff of "tough times" ahead.
Singapore Airlines, which holds a 25.1% stake in Air India, sent senior leadership to Mumbai in April, fueling speculation about deeper involvement in the struggling carrier. Air India declined to comment on the BBC's inquiries.
Operational and safety concerns
Former Air India executive director Jitendra Bhargava told the BBC that the Tata Group "underestimated the problems" inherited from the state-run airline. Wilson's departure, he said, leaves a critical gap as the airline struggles to execute its five-year turnaround plan.
Recent incidents have further damaged Air India's reputation. In March, a Delhi-Vancouver flight was forced to return after nearly eight hours in the air due to missing regulatory approvals for Canadian airspace. Aviation consultant Alok Anand called the error "highly unusual," indicating a breakdown in internal processes.
Last year, India's aviation regulator identified 51 safety violations during its annual audit, including seven classified as the most severe. These lapses have raised questions about the airline's operational integrity as it grapples with the aftermath of the Ahmedabad crash.
External pressures compound challenges
Air India's expansion plans have been derailed by supply chain delays, leaving dozens of new aircraft undelivered and disrupting fleet modernization. The airline has also scaled back routes since 2024, canceling key services like Delhi-Washington and Mumbai-San Francisco, which likely contributed to revenue losses.
The rupee's 10% depreciation against the U.S. dollar has exacerbated financial strain, as fuel and other costs are dollar-denominated. Aviation analyst Mahantesh Sabarad noted that currency weakness has been a "major challenge" for the airline's recovery efforts.
What lies ahead
Experts warn that Air India's financial woes may worsen before improving. Alok Anand suggested that recent losses could stem from legacy costs, such as refurbishment payments and lease penalties for returned aircraft. The impact of high fuel prices, currency depreciation, and route closures is expected to deepen in the coming months.
Sabarad emphasized the need for shareholder support, comparing the $2.4 billion loss to Tata Steel's financial struggles after acquiring Corus Steel in 2007. "The Tatas didn't give up then," he said, "but they should explore innovative financing solutions now."
The Middle East conflict presented an opportunity for Air India to expand its international footprint as Gulf carriers faced disruptions. However, aircraft shortages have limited its ability to capitalize on the moment.
Reputation at stake
The AAIB's final report on the AI-171 crash could have significant reputational consequences. While financial liabilities are largely covered, Sabarad warned that negative findings could further damage the airline's image, requiring extensive efforts to rebuild trust.
"Between their plan and its implementation, there have been big and growing gaps."
Jitendra Bhargava, former Air India executive director
