Air India's CEO-Designate Tewolde Gebremariam Pitches For Cost Discipline, Sustainable Profits

Air India's incoming CEO Tewolde Gebremariam on Monday emphasised the need to improve financial performance and announced plans to introduce programmes that will reward staff who come up with ideas to bring down cost.

Asserting that achieving sustainable profitability remains a key objective, Gebremariam said cost discipline must become part of the airline's culture.

"Cost management is not just the responsibility of leadership or the finance function. Every employee can contribute to savings, and those savings add up across an organisation of our scale," he said at a townhall.

Gebremariam, who has been appointed as the CEO and MD of the loss-making Tata Group-owned airline, will take charge after receiving requisite security approvals.

In his second interaction with the employees in recent weeks, Gebremariam said the airline plans to introduce programmes that reward ideas that generate measurable cost savings and operational efficiencies.

According to him, a combination of external factors has affected Air India's path to break even but stressed that the airline cannot afford to lose focus on financial performance.

"We must improve both revenue and cost performance. Revenue enhancement initiatives are already under discussion, including opportunities across our international network, commercial activities and cargo business," he said.

An Ethiopian Airlines Group veteran, Gebremariam will be the second foreign CEO at Air India and will be taking over the reins at a time when the airline is working on its ambitious expansion plans amid multiple external headwinds.

Gebremariam also said scale is critical in a business characterised by high capital investment, significant fixed costs and intense competition.

"Growth is the oxygen of business. But growth must also be profitable and sustainable. We will pursue expansion in a disciplined manner and ensure our people, fleet and network are ready to support it," he said.

Besides, Air India continues to evaluate opportunities to enhance network efficiency, optimise fleet deployment and rebalance operations to improve long-term competitiveness.