Cracks, questions and a changing guard at Tata

Tata Group, a behemoth in Indian industry known for its vast reach across sectors including steel, energy, hospitality, automotive, and technology, is facing mounting challenges as it navigates a complex landscape of financial pressures, operational hurdles, and leadership transitions. The company’s flagship airline, Air India, continues to struggle despite efforts to restore its fortunes, while other key subsidiaries face disruptive forces reshaping their business models. Meanwhile, the departure of N Chandrasekaran, the long-standing chairman of Tata Sons, marks a pivotal moment in the group’s evolution, raising questions about the future direction of its governance structure and strategic priorities. The difficulties at Air India have intensified in recent months, drawing both public and regulatory attention. The airline, which was returned to Tata’s control in 2022 after years of government oversight, has faced multiple incidents that have tested its operational integrity and safety protocols. In June 2025, Flight AI171, an Airbus A320neo bound for London from Ahmedabad, crashed shortly after takeoff, resulting in the deaths of 241 passengers and 19 others on the ground. The crash, which occurred near the airport, sparked immediate investigations and raised concerns about the airline’s safety standards. Although the cause of the accident remains under review, the incident has cast a shadow over Air India’s recovery efforts. Further complications emerged in early 2026 when a flight from Phuket to Delhi experienced a sudden drop of approximately 300 feet in altitude, leading to injuries among 24 passengers. This incident triggered a formal probe by the Aircraft Accident Investigation Bureau. Compounding these issues, the pilot of the affected aircraft tested positive for marijuana in a confirmatory drug test, although no direct connection between the substance and the altitude loss has been established. In response, Air India initiated a comprehensive, one-time drug-testing program for all pilots across its operations, exceeding the standard regulatory requirements for random testing. These developments have significantly impacted Air India’s financial performance. For the fiscal year ending March 2026, the combined entity of Air India and Air India Express recorded a net loss of Rs 22,238 crore, nearly doubling the Rs 10,859 crore loss reported in the previous year. Revenue for Air India alone dropped to Rs 71,870 crore from Rs 78,636 crore during the same period. Despite these setbacks, Tata Group has maintained its commitment to revitalizing the airline, emphasizing not just profitability but also modernization and restoring public trust. The challenges extend beyond Air India. Tata Consultancy Services, the group’s largest IT services provider, is grappling with the rapid advancement of artificial intelligence technologies, which threaten to disrupt traditional service models. Meanwhile, Jaguar Land Rover, a subsidiary acquired by Tata, has seen declining quarterly profits, reflecting broader shifts in the automotive market. Additionally, the group is investing heavily in semiconductor manufacturing, allocating more than Rs 1 lakh crore toward new facilities, a move that underscores its ambition to diversify and compete globally. As these challenges unfold, the leadership transition within Tata Sons looms large. N Chandrasekaran, who has guided the group since 2017, will step down in February 2027, marking the end of an era. His successor will inherit a complex portfolio of enterprises, each facing distinct challenges and opportunities. The transition has already drawn attention to the relationship between the Tata Trusts, which hold the controlling stake in Tata Sons, and the professional management team responsible for day-to-day operations. This dynamic is likely to shape the group’s strategy moving forward.