Air India is preparing one of the largest aircraft deals in history Business and economic news

The carrier plans to order up to 300 narrow aircraft from Airbus or Boeing or both.

from Bloomberg

Air India Ltd. is considering ordering up to 300 narrow aircraft, according to acquaintances, in what could be one of the largest orders in the history of commercial aviation, as the former state-owned airline seeks to renew its fleet under new ownership.

The carrier could order Airbus SE’s A320neo family planes or Boeing Co.’s 737 Max, or a combination of the two, people said, asking not to be identified because the discussions are confidential. The deal for 300 737 Max-10 aircraft could cost $ 40.5 billion prices of stickersalthough discounts are common on such large purchases.

Winning a narrow-hull contract in India would be a coup for Boeing, as rival Airbus dominates the skies in the country, the world’s fastest-growing aviation market before the Covid pandemic. IndiGo, operated by InterGlobe Aviation Ltd., is the world’s largest customer for the European manufacturer’s best-selling narrow bodies, ordering more than 700 others, including Vistara, Go Airlines India Ltd. and AirAsia India Ltd. fly planes of the same family.

The production and delivery of 300 aircraft is likely to take years or even more than a decade. Airbus builds about 50 narrow-body aircraft per month, with plans increase it to 65 by mid-2023 and 75 by 2025.

Representatives of Air India and Boeing declined to comment. An Airbus spokesman said the company was always in contact with existing and potential customers, but all discussions were confidential.

“This order is likely to include new financing methods that are being implemented in the right way, including taking into account macroeconomic trends – in particular fluctuations in the rupee and rising inflation,” said Satiendra Pandei, managing partner of aviation consulting firm AT-TV. . “Some airlines have made large orders only to find that they cannot provide financing on favorable terms. While this is not a result one imagines, and certainly not with a band like Tata, it still needs to be planned.

The owner of the Air India Tata Group is also close to ordering long-haul Airbus A350s that can fly all the way to the west coast of the United States from New Delhi, Bloomberg News reported this month. Formerly known for its first-class services and advertisements featuring Bollywood stars, the airline still has lucrative landing slots at most major airports, but faces competition from foreign airlines with continuous services to India, as well as carriers flying through centers in Middle East.

Tata bought the airline earlier this year in the most famous privatization under Prime Minister Narendra Modi. It is expected to consolidate its aviation business, including four airline brands. Ordering new aircraft, especially with favorable long-term maintenance conditions, would help it reduce costs and compete better with competitors who offer very cheap fares.

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