The father of the pilot involved in the Air India crash is mounting a campaign to salvage his son's reputation, even as British investigators scrutinise the final moments of the doomed flight. This is a classic case of market sentiment shifting from grief to blame, and the family is now trying to prop up a tarnished asset.
From a financial perspective, this disaster has already written down the value of lives lost and the airline's goodwill. The father's efforts to deflect culpability onto maintenance failures or systemic issues are akin to a corporate board blaming market conditions for poor earnings. It doesn't change the bottom line: the crash cost 158 lives and billions in liability.
British investigators from the Air Accidents Investigation Branch (AAIB) are now on site, and their report will be the equivalent of an audit. They will pore over cockpit voice recorders, flight data, and maintenance logs. The market hates uncertainty, and until that audit is released, Air India's shares will trade at a discount reflecting this unknown risk.
There is also the question of sovereign risk. Air India is a national carrier, and the Indian government is its majority shareholder. Any fault laid at the feet of the pilot or the airline will reflect on India's aviation regulatory regime. Foreign investors will take note. Capital flight is a real possibility if the report suggests systemic failures.
Meanwhile, the pilot's father is running a public relations campaign. He is claiming his son was a hero and that the crash was due to a bird strike or hydraulic failure. This is standard human behaviour: we want to protect our legacy assets. But the market is indifferent to sentiment. Gilt yields haven't moved on this tragedy, but insurance premiums for Indian aviation have spiked.
Let's not forget the pilots union angle. They will argue that the crew was overworked and underpaid. That is a structural cost issue. If the investigation recommends mandatory rest periods, that will increase labour costs for Air India, further eroding its already thin margins.
In the end, this story will be resolved by hard data, not personal appeals. The AAIB report will be the final valuation. Until then, the market will price in a risk premium on all Indian aviation stocks. The father's fight for honour is a noble but futile gesture in the face of actuarial tables and flight recorder data.
Investors should watch for early signs in the report: if the pilot is found at fault, expect a sell-off in airline stocks globally as confidence in pilot training standards erodes. If it's mechanical, focus on the manufacturer. Either way, the bottom line is that this tragedy has already been priced in, but the volatility is far from over.
