As it embarks on an ambitious resurgence under the Tata Group empire, Air India is close to placing historic orders for as many as 500 jetliners worth tens of billions of dollars from both Airbus and Boeing.
The final touches are being put on the massive deal in the coming days, and the orders include as many as 400 narrow-body jets and 100 or more wide-bodies, including dozens of Airbus A350s and Boeing 787s and 777s, according to reports.
This deal, which would be among the biggest in terms of volume placed by a single airline and surpass American Airlines’ purchase of 460 Airbus and Boeing planes from more than ten years ago, may be worth more than $100 billion at list prices, including any options.
The transaction, which would be worth tens of billions of dollars even after large anticipated discounts, would end a tumultuous year for aviation giants, whose planes are once again in demand following the pandemic but who are also facing increasing industrial and environmental challenges.
Additionally, it would enable Airbus to find a home for some A350 production slots that were originally reserved for Russia’s Aeroflot but are currently vacant as a result of sanctions related to the conflict against Moscow.
On the other hand, China, this week delivered its first C919 airliner; analysts estimate that the country is at least ten years away from competing on this scale.
After Tata announced the merger of Air India and Vistara, a joint venture with Singapore Airlines, to form a larger full-service carrier and strengthen its position in domestic and international skies, the possible order was made just a few days later.
Tata now has a fleet of 218 aircraft, making Air India the largest international carrier in the nation and the second-largest domestic carrier behind IndiGo.
The maharajah mascot of Air India was originally associated with opulently decorated aircraft and first-rate service, but as financial difficulties grew in the mid-2000s, its reputation began to tarnish.
JRD Tata founded Air India in 1932, and it became a national carrier in 1953. After regaining control in January, Tata has been attempting to restore its standing as a premier airline.
The ranking reflects a goal to reclaim a sizable portion of travel between India’s sizable overseas diaspora and major cities like Delhi and Mumbai, which are dominated by foreign competitors like Emirates.
The 500 planes, which will be delivered over the following ten years, which will help India’s Prime Minister Narendra Modi achieve his aim of boosting the economy in India to $5 trillion by replacing and expanding fleets in the fastest-growing air travel sector in the world.
However, experts caution that a number of obstacles, including weak domestic infrastructure, a lack of pilots, and the danger of fierce competition from established Gulf and other airlines, stand in the way of Air India’s aim to regain a significant worldwide position.
As the European aircraft manufacturer is sold out until 2028 or later, it might also have trouble getting the medium-haul Airbus A321neos bought for the Air India-Vistara partnership as swiftly as it would like.
According to a source in the industry, Air India Express, the company’s low-cost carrier, which may be given a new name, will most likely receive new Boeing 737 MAX aircraft.
According to insiders, aircraft and engine manufacturers have been knocking on Air India’s door for months, but the airline’s new CEO, Campbell Wilson, has refused to rush the decision, which could make or break its fleet.
In addition to a potential mixed order for smaller single-aisle aircraft, as per reports, Air India was taking extra time to research Airbus A350s and Boeing wide-body 787 and 777 planes.
At the risk of gross understatement, the investment will be substantial, Campbell stated last month that there are plans to “greatly expand” Air India’s fleet over the next five years.