After Air India buy, Tata group companies can cross-sell products

The acquisition of Air India will help a host of Tata group companies from software major, TCS, and soon-to-be launched TataNeu super app to sell their products to the airline. 

The group is also identifying opportunities for Tata Capital, its fast growing financial services business and for Indian Hotels, the operators of Taj group of hotels, which will also be able to cross-sell products to Air India’s customers and the airline’s crew.

According to a source, several Tata group companies are already supplying their products to the two airlines operated by the Tata group and the acquisition will help the suppliers to sell products to Air India at a cheaper price as the volumes will grow.

Rajesh Gopinathan, CEO & MD, TCS, said the company will be in the race to bag Air India’s technology contracts. “I think it (the acquisition of AI) underlines the optimism in the environment. The nature of the transformation is possible by leveraging technology to make a big impact. We are the leading provider of technology services to the airline industry globally. We’ve seen this kind of resilience in this customer segment over the last two years,” Gopinathan said.

“We will try to do our best and contribute in whichever form we can to revive it to the glory it had as one of the best airlines in the world,” Gopinathan said.

Group insiders said apart from TCS providing back-end support to Air India, the TataNeu super app will be selling Air India’s tickets on its platform. The airline’s tickets are already available on rival platforms such as Amazon, Flipkart and MakeMyTrip and TataNeu will be coming out with new co-branded schemes with Air India to entice customers. “We are in talks to rope in Tata Capital Financial Services to offer various schemes to Air India customers via the superapp,” said a Tata group insider.

“The on-boarding of additional 12,000 employees are potential buyers of Tata products from cars to real estate,” he said.

One of the biggest synergies will be with Indian Hotels which operate “Taj Mahal”-branded properties all over India. Apart from Air India crew using Taj properties, the airline can sell Taj’s products to the airline’s customers as a package. 

Air India has a frequent flier club customer base of 3 million that can be used to offer discounted products. Besides, a Tata group official said, the airline can offer hotel bookings at destinations at a discounted rate.

“The potential for the Tata group is immense. We have to make sure that the marketing teams across all Tata group companies are on the same page and help each other to sell products,” the official said.

Another official said the Indian government has recently signed a contract with Airbus to buy 56 military planes worth Rs 20,000 crore and Tata Airbus will manufacture 40 aircraft in India. The experience gained in negotiating the contracts with Airbus will be used in buying civilian aircraft in future. The group is consolidating its businesses across aerospace and defence sectors together under a single entity — Tata Aerospace & Defence (Tata A&D).