After superfast ascent, pilot turbulence leaves Akasa Air wobbly
Crew allegations range from poor communication and hostile work environment to concerns about safety and training standards, but young airline is denying it all
It's sector that thrives on operational precision and high employee morale. And Akasa Air, the country’s newest airline, is finding itself navigating unexpected turbulence.
The troubles are not exactly financial — Akasa has raising funding from prominent investors like Premji Invest and Ranjan Pai’s family office. But, it is facing internal crises stemming from allegations of weak management practices that threaten to stall its ambitions.
Akasa Air, started by a clutch of airline professionals and backed by India’s Warren Buffet, the late Rakesh Jhunjhunwala, entered the highly competitive market with lofty ambitions of disrupting a competitive landscape dominated by legacy carriers.
By November 2024, the two-year-old airline had captured a market share of 4.7 per cent, surpassing two-decade-old SpiceJet’s 3.1 per cent, an impressive feat for an airline still in its infancy.
With plans for aggressive expansion backed by a $125-million investment from Premji Invest and Claypond Capital, Akasa seemed poised for a meteoric rise.
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First signs of trouble
However, the airline’s rapid scale-up revealed cracks in its foundation. In its quest for growth, Akasa Air appeared to have overlooked critical management protocols and employee relations, setting the stage for a series of challenges, as alleged by a section of its employees.
The first signs of trouble emerged with accusations of mismanagement and favouritism from Akasa’s employees, particularly its pilots.
Allegations ranged from lack of communication and a hostile work environment to concerns about safety and training standards. These grievances soon escalated into a full-blown crisis.
A group of pilots alleged that they are seeking an independent investigation by the Ministry of Civil Aviation regarding safety and training practices, as they have flagged high failure rates among pilots and unfair practices.
Pilot problems
Key among the complaints were issues surrounding pilot training. Allegations of unprofessional conduct by trainers, high failure rates in simulator evaluations, and of biased assessments started doing the rounds inside the company.
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Pilots accused the management of pressuring them to work under unsafe conditions, including flying while unwell, all of which were dangerous practices which could damage their reputation. The situation became untenable, leading to the resignation of 43 pilots in a short span, disrupting the airline’s operations.
As expected, the airline management has tried to play down the pilot exodus and the airline's viability.
“We have sought legal remedy only against a small set of pilots who abandoned their duties and left without serving their mandatory contractual notice period. Their actions were not only in violation of their contract but also the country's civil aviation regulation,” the airline said in a statement.
Flight cancellations
The departure of a sizeable number of pilots had an immediate impact on Akasa Air’s operations. The airline, which typically operated 120 flights daily, was forced to cancel nearly 24 flights per day, amounting to a total of 600-700 cancellations.
Rapid scaling
Industry analysts point to the airline’s rapid scaling as the root cause of its current woes. While Akasa Air focused on aggressive growth to compete with established carriers, it apparently failed to develop the robust management practices and communication frameworks necessary to sustain such expansion if one goes by the litany of charges by its employees.
The aviation industry, known for working under high-pressure situations, expects clear communication and a strong cultural foundation.
Employees alleged that Akasa’s inability to foster these elements has resulted in a workforce grappling with mistrust and high dissatisfaction. Allegations of favouritism, harassment, and unfair training evaluations are learnt to have further deepened divisions, eroding morale among pilots and crew.
However, the airline management has tried to play down the entire crisis. “We are never more confident about our future and continue to invest prudently, with longer-term financial success in focus,” said CEO Vinay Dube.
Financial performance
Akasa Air’s financial performance underscores the cost of its growing pains.
Despite a substantial increase in total income – from ₹777.84 crore in FY23 to ₹3,144.38 crore in FY24 – the airline’s losses more than doubled, reaching ₹1,670.06 crore in FY24. Increased expenses, driven by fleet expansion and operational costs, highlighted the strain of rapid scaling.
The airline’s leadership, including CFO Ankur Goel, has maintained that such losses are expected in the early years, as investments in infrastructure, training, and fleet typically precede profitability.
However, the combination of operational disruptions and mounting losses raises questions about the airline’s ability to sustain its ambitious growth trajectory.
Confidence in potential
Despite its challenges, Akasa Air remains optimistic about its future. The infusion of $125 million in fresh investment and plans to raise $1 billion over the next three years signal continued confidence in its potential.
Yet, the airline’s success will hinge on its ability to resolve internal conflicts, rebuild employee trust, and establish a stable operational framework.
Addressing allegations of mismanagement and ensuring compliance with safety and training standards will be critical. While asserting overall job satisfaction among pilots, the management's denial of these accusations appears out of sync with the reality of widespread resignations.
A transparent, independent investigation into the airline’s practices may be the first step toward restoring confidence among its workforce.
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Scale but with caution
Akasa Air’s story offers valuable lessons for the aviation industry.
Growth, while essential, must be balanced with a commitment to building a strong cultural foundation and fostering employee satisfaction. For new entrants, the temptation to scale quickly to capture market share must be tempered by investments in management practices, communication, and training.
As Akasa Air works to stabilise its operations and repair its reputation, its journey serves as a cautionary tale of the challenges that arise when rapid expansion outpaces the fundamentals of organisational management.
Whether the airline can weather this turbulence and achieve its ambitious goals remains to be seen, but its trajectory will be keenly watched and perhaps shape the future of aviation in the region.
