Board to take a final call on workforce, cost curbs and lower flight operations
Tata Group-backed Air India is reviewing workforce rationalisation proposals as part of a broader effort to stabilise finances amid mounting operating pressures, sources told businessline.
Accordingly, the airline’s board is expected to take a final call on measures linked to lower flight operations, workforce restructuring, and overall cost rationalisation.
When contacted, Air India did not respond to queries on the reported proposals for workforce rationalisation.
businessline on Wednesday, April 22, reported that the airline is evaluating a 15-20 per cent reduction in flight operations, while at the group level, the curtailment may be restricted to 10-15 per cent.
Workforce reduction
Consequently, workforce reduction has emerged as a key proposal under review after internal deliberations on network rationalisation gathered pace.
Speaking to businessline, sources said the airline is evaluating measures including benching around 10 per cent of crew and a potential reduction of 5-7 per cent of the overall workforce as part of cost-control efforts.
Currently, the Air India Group employs around 24,000 professionals.
As per sources, these proposals were reviewed by the airline’s Managing Committee and are likely to be placed before the board next month.
The review follows reported losses of around ₹20,000 crore for FY26, which have intensified internal deliberations around expenditure control and operational efficiency.
Notably, elevated aviation turbine fuel prices, airspace closures, and a depreciating rupee have significantly strained the airline’s balance sheet.
Fleet induction
According to sources, the current financial environment may also affect ongoing investments in fleet induction and service upgrades.
The airline has sought additional funding support exceeding ₹10,000 crore from stakeholders to navigate the present operating environment.
Besides, sources said the carrier is also seeking excise duty and VAT relief from the government on aviation turbine fuel prices, which account for more than 40 per cent of operating expenditure.
“Backup plans are being made to stave off any financial exigencies,” sources told businessline. “However, we are awaiting more relief measures to be introduced by the government.”
Furthermore, sources said that international services are expected to bear the sharper impact, especially long-haul sectors to Europe and North America.
Meanwhile, industry executives said airspace-related diversions and revised routing have increased flying times on several corridors, affecting fleet and crew utilisation and limiting the number of rotations aircraft can perform within a given schedule cycle.
As a result, the airline is reassessing route viability and frequency planning as part of a broader network optimisation exercise.
While domestic routes may also witness selective changes, sources said international operations are likely to see a sharper impact given the higher cost burden and increasingly challenging turnaround economics.
In addition, sources said that following the board meeting in early May, departments across the airline may be directed to curtail expenditure and improve savings to meet financial targets.
“All these measures are currently under internal review,” said another source aware of the matter.
Published on April 23, 2026