Air India suffers a massive financial setback, racking up a staggering loss of 10,859 crores during the fiscal year 25.
In a recent financial report, the consolidated entity of Air India and Air India Express, under the Tata Group, recorded a substantial loss of ₹10,859 crore for the fiscal year 2024–25. This marked a 48% increase in losses year-on-year, despite a 18% revenue growth to ₹78,636 crore during the same period.
The significant losses can be attributed to several key factors. Firstly, high transformation and integration costs incurred after consolidating four Tata Group airlines into two main entities: Air India and Air India Express. This merger process generated considerable expenditure around harmonizing operations, fleet expansion, and rebranding.
Secondly, the capital and debt burden was another contributing factor. Tata Group took on ₹15,300 crore of Air India’s debt, with the remaining ₹46,000 crore transferred to a separate asset holding company. Capital infusion from Tata Sons and Singapore Airlines totaled ₹9,558 crore in FY25 to fund expansion and restructuring efforts.
Thirdly, foreign exchange impacts played a role in the increased losses. Although specific forex losses are not detailed in the sources, the surge in losses includes expenses related to currency fluctuations, as airlines typically bear significant forex risks in fuel purchases, aircraft leases, and international operations.
Despite higher passenger traffic, capacity expansion, and improved seat occupancy, Air India’s losses exceeded the total estimated losses for the entire Indian aviation industry in FY25. By contrast, market leader IndiGo reported a profit of ₹7,258 crore for the same period.
On a standalone basis, Air India registered a revenue of ₹61,080 crore and a net loss of ₹3,976 crore. Air India Express, on the other hand, made a loss of ₹5,678 crore on a revenue of ₹16,033 crore. Air India Express has added over 50 Boeing 737 Max aircraft, but the result was impacted by mark to market losses due to adverse foreign exchange movement.
Air India’s standalone losses reduced by 21% compared to FY24, and its standalone revenue grew by 13.5% due to capacity expansion. The standalone results do not include results of the airline’s subsidiaries and joint ventures. Air India Express incurs lease rental costs, while lease sale and back gains are booked by Air India.
The financial results reflect Air India’s ongoing transformation, including fleet addition, network rejig, improved sales and distribution, and commercial partnerships. It is suggested that the overall positive trajectory for the Air India group and business transformation results should be seen in another two years. The article was published on July 24, 2025.
Despite the substantial losses, the consolidation of Tata Group’s airlines has shown strong revenue growth and market share gains. The ongoing transformation and restructuring efforts are expected to improve the financial performance of Air India and Air India Express in the future.
The consolidation of Tata Group's airlines, despite the substantial losses, has indicated a significant 18% revenue growth to ₹78,636 crore for Air India and Air India Express in the fiscal year 2024–25. The ongoing transformation and restructuring efforts, such as fleet expansion, harmonizing operations, and rebranding, have added to the business's expenses, yet contributed to market share gains. The financial industry is closely monitoring the future financial performance of Air India and Air India Express. Additionally, it's worth noting that the business's losses exceeded the total estimated losses for the entire Indian aviation industry in FY25, making it crucial for the airline to implement successful strategies for improvement.
