Tata Group-owned Air India has established a full-time team to systematically review expenditure and identify cost-saving opportunities across the airline, in an attempt to embed cost consciousness, frugality and disciplined decision-making into its culture.
In his first internal communication to airline employees, seen by HT, Air India’s chief executive officer (CEO) Tewolde Gebremariam said cost savings could not be driven by a single team or function and required the active participation and commitment of every employee.
“Cost consciousness must become part of our culture,” the CEO said, adding that alongside operational excellence, the airline needed to embed “a mindset of frugality, accountability, and thoughtful decision-making in everything we do”. “Cost savings cannot be driven by a single team or function alone,” he said.
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The focus on costs comes as airlines continue to operate in a challenging environment, with oil prices elevated amid the West Asia crisis and pressure on fuel bills, margins and flight routes.
Small decisions, taken consistently across the organisation, can collectively strengthen the airline’s financial resilience, according to Telwode.
“To support this effort, a multidisciplinary, cross-functional Cost Savings Team has been established on full-time basis to identify cost-saving opportunities across the organisation. They will systematically review all expenditure and identify cost-saving opportunities across functions,” he said.
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The CEO asked employees to extend their “full support and cooperation” to the team as it works to deliver cost efficiencies across the organisation.
He also said that Air India is launching ‘PRABHAV – The Value Creator Award’, an initiative inviting employees to submit ideas to reduce costs, improve efficiency and maximise revenue.
The initiative will consider ideas involving smarter ways of working, improved utilisation and processes, contract optimisation or renegotiation, insourcing of outsourced activities, optimal use of resources, cost-effective procurement and waste reduction. It will also consider proposals to question existing practices, maximise revenue through new opportunities and derive greater value from existing products, services and capabilities.
“All submissions will be evaluated through a structured review process, and ideas that can be successfully implemented will be recognised and rewarded under the PRABHAV framework,” he said. Details of the submission process will be shared separately, he added.
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“I encourage each of you to participate. No idea is too small and the best ideas often come from those closest to the work,” he said, adding that small improvements across a large organisation could create a significant impact.
As another step towards cost consciousness and disciplined decision-making, the CEO said the airline had revised its staff on duty (SOD) approval matrix.
“Effective October 1, all approvals will be routed through the head of department (HOD), chief experience officer (CXO) and CEO,” he said, adding that the revised process is intended to ensure greater rigour, transparency and alignment in decision-making across the organisation.
“Every rupee we save creates an opportunity to reinvest in areas that matter most, whether it is enhancing our operations, improving our products and customer experience, or strengthening the foundations for our future growth,” he said.
In his message, the CEO pointed to airspace closures, the West Asia conflict and the resulting operational disruptions, along with persistently high jet fuel costs, as factors putting significant pressure on airlines across the industry.
“Our ability to overcome these headwinds will depend not on individual efforts, but on how effectively we come together as one team,” he said.
The internal communication also highlighted developments across the airline's commercial partnerships, network expansion, customer experience and safety initiatives.
The CEO also praised Air India Express, noting that it has announced its 2026-27 winter schedule, effective October 25, which will expand its network to nearly 585 daily flights across 220 routes and 65 stations, backed by a fleet of more than 105 aircraft.