On November 12, a significant shift in India’s aviation sector will unfold as Vistara, one of the most admired airlines in the country, ceases to exist as an independent entity. This marks a pivotal moment in the airline industry, as Vistara’s operations will now be integrated with Air India, a merger that has sparked much anticipation and debate about brand dynamics and strategic direction.
The merger is part of Tata Group’s larger vision to create a unified national carrier. However, the challenge lies in how two distinctly different brands, with varying service standards, operational strategies, and consumer perceptions, will come together seamlessly. Air India, once a national pride, has struggled with service issues and a tarnished reputation, while Vistara has carved out a strong identity as a premium, service-oriented airline. The CEO of brand advisory firm TRA Research, points out the unusual nature of this merger. In most cases, the stronger brand absorbs the weaker one, but in this scenario, Vistara’s relatively young and service-centric identity will be overshadowed by Air India’s legacy. The stakes are high as the merged entity will need to balance the expectations of a premium service airline with the challenges of restoring Air India’s legacy and fixing its service issues. The Tata Group will undoubtedly be hoping that this merger not only enhances Air India’s reputation but also brings the operational excellence and customer service of Vistara into the fold.
Brand mergers are never without risk. The Vodafone-Idea merger in 2018 provides a cautionary tale. While Vodafone retained its name post-merger, the combined entity struggled with network congestion, service disruptions, and an exodus of customers. More than 67 million subscribers left the network since 2021, and the company is now burdened with debt while scrambling to modernise its infrastructure. The comparison between Air India and Vistara is strikingly similar to Vodafone and Idea’s attempt to merge in the face of competition from a stronger rival—in this case, the rise of low-cost carriers in India and the ever-growing competition from global giants like Emirates. For Air India, avoiding the pitfalls of Vodafone’s struggles will require both operational innovation and a significant shift in customer experience. The Tata Group’s focus will likely be on improving in-flight services and streamlining operations across the newly unified brand to create a more cohesive offering.
In the automotive industry, a different example of brand evolution can be seen in Toyota’s shift from the Qualis to the Innova. The Qualis, despite its success in terms of sales, was associated with safety issues, especially due to overloading and rash driving by fleet operators. The switch to the more sophisticated and safer Innova helped Toyota reposition itself in the minds of consumers, building a stronger brand with better style and safety standards. For consumers, the merging of these brands often carries a mixed bag of emotions. While some may look forward to an enhanced, streamlined offering, others may feel a sense of loss as they bid farewell to a beloved brand. The case of Air India and Vistara highlights how mergers are not just business decisions—they are emotional shifts for consumers who have grown attached to the distinct identities of these brands.
In the context of sustainability, mergers can be seen as a way to consolidate resources and reduce redundant operations, potentially leading to a more efficient, cost-effective business model. However, they also carry the risk of alienating loyal customers if the transition is not handled well. For Air India and Vistara, the challenge will be to combine the best of both brands while maintaining consumer loyalty and operational excellence. Ultimately, as these two iconic names merge, the industry and consumers alike will be closely watching whether this bold corporate move results in a more robust, competitive force in India’s aviation sector or whether the complexities of blending brand identities will create more turbulence than expected.
