A large order costing tens of billions of dollars for 500 jetliners is about to be placed by Air India. According to reports, the airline would purchase 500 new aircraft from Airbus and Boeing as it pushes toward an extensive and ambitious resurrection under the Tata Group conglomerate, which acquired it in January of this year. Apparently, the deal is currently being completed.
This transaction could be among the largest ever made by a single airline in terms of volume; at list pricing with options, it could potentially reach $100 billion. It might even eclipse a more than ten-year-old order for 460 Airbus and Boeing aircraft placed by American Airlines.
Even while the Tata Group won’t agree to a sale without certain concessions, the transaction would undoubtedly be worth tens of billions of dollars and would end a turbulent year for the sector.
Additionally, news of this potential order comes only a few weeks after Tata announced plans to unite Air India and Vistara to grow its full-service airline and increase its domestic and international air presence. A joint venture with Singapore Airlines was involved (SIA).
With the former Vistara contract and this latest purchase of 500 planes, which will take at least ten years to fulfil, it appears that Tata Group is meticulously planning to regain a sizable portion of the traffic flows to and from India, which are currently dominated by foreign carriers like Emirates.
Along with this, Air India also appears to be eager for a larger proportion of domestic and regional foreign traffic, setting up a conflict with competitor IndiGo in both areas.
India is the country with the fastest-growing airline market in the world; 500 new aircraft would both replace and extend fleets and serve a growing customer base as more and more Indians see flying as an accessible and reasonably priced form of transportation.
The ambition of Prime Minister Narendra Modi’s administration is for India to have a $5 trillion GDP. This transaction would help with that.
In order to achieve its goal of once again leading the world, Air India has a number of challenges, according to experts. Inadequate domestic infrastructure, a lack of pilots, and the potential for fierce competition with well-established Gulf and foreign carriers are a few of these.
Source: Indian Express