The crisis brewing in the AirAsia India boardroom seems to have deepened as multiple media reports suggest its chief executive officer Mitu Chandilya has decided to quit the airline.
According to a report by CNBC-TV18 citing sources, Chandilya is unhappy with "micromanagement by its Malaysian parent". His three-year contract is to be over on 31 March. According to sources, he has appraised the management of his unwillingness to continue once the contract ends.
"AAIPL is completely run by parent AirAsia which decides vital issues like network planning and revenue management," sources have been quoted as saying in a report in the Times of India on Friday. According to the report, the company has been performing poorly as its losses widened to Rs 61.1 crore in the September quarter from Rs 44.1 crore from the quarter earlier. It enjoys 2 percent of the Indian aviation market.
A bitter battle has been brewing at Air Asia India involving the company's co-founder Arun Bhatia of Telestra Tradeplace and partners the Tata group and AirAsia.
The Economic Times had recently reported that Bhatia was unhappy with the way the airline is being controlled by AirAsia BhD, violating the Indian law of effective control of an aviation company.
AirAsia India is 49 percent owned by AirAsia Malaysia, 41 percent by the Tata group and 10 percent by Telstra. At the time of formation AirAsia India, Tatas had 30% stake and Telestra Tradeplace 21%. The Tatas also have a joint venture partnership with Singapore Airlines for a full-service airline in India, Vistara.
In mid-2013, Bhatia had publicly stated he was disappointed with the Tatas for not keeping him in the loop while investing in a second airline.
Firstpost had recently reported that the Tata group will soon buy out the Telstra's 10 percent stake in AirAsia India, making it the majority shareholder in the low-cost carrier.
Published Date: Feb 12, 2016 12:00 PM | Updated Date: Feb 12, 2016 12:12 PM