Air India CEO Tewolde Gebremariam sets up committee to explore cost cuts, team mergers and lower office lease expenses

Air India's new chief executive, Tewolde Gebremariam, has formed a committee to explore cost-saving measures as the airline grapples with mounting losses, according to sources.

Air India CEO sets up committee to explore cost-cutting measures

The committee, set up under Gebremariam, is examining options that include rationalising certain teams across Air India and its subsidiary, Air India Express.

Relocating office space occupied by Air India Express to bring down lease expenses is also among the measures under consideration, the sources told PTI.

The airline's board of directors is scheduled to meet on Thursday, where cost-cutting measures are also expected to be discussed. Air India did not immediately respond to queries seeking comment on the committee.

Gebremariam, a veteran of Ethiopian Airlines, formally took charge as Air India's chief executive officer and managing director on 1 October. He is the second foreign national to lead the airline as CEO and MD.

On 28 September, he told employees that cost discipline needed to become part of Air India's organisational culture. He identified sustainable profitability, safety and operational reliability as key priorities for the carrier.

Gebremariam also announced plans to introduce programmes that would reward employees for ideas that deliver measurable savings and improve operational efficiency.

Why is the cost-reduction exercise necessary?

The cost-reduction exercise comes as Air India faces significant financial and operational challenges. The airline, jointly owned by the Tata Group and Singapore Airlines, reported a consolidated loss of ₹22,238.23 crore in the financial year ended March 2026, compared with ₹10,858.83 crore in the previous year.

Its total income also declined during the period, falling to ₹71,869.94 crore from ₹78,635.61 crore in 2024-25, according to regulatory filings. The consolidated figures include Air India Express.

The airline has faced several headwinds, including the fatal AI171 crash in June 2025, which killed 260 people, alongside geopolitical disruptions, airspace closures, volatile fuel prices and operational difficulties.

With losses more than doubling year on year, the committee's review signals a renewed focus on controlling expenses. However, the specific measures to be implemented, and the extent of any team restructuring or office relocation, remain unclear.