Air India unveiled deals on Tuesday for a record 470 jets from Airbus and Boeing, accelerating the rebirth of a national emblem under new owners Tata Group as Europe and the United States hailed deepening economic and political ties with New Delhi.
The provisional deals include 220 planes from Boeing and 250 from Airbus and eclipse previous records for a single airline as Air India vies with domestic giant IndiGo to serve what will soon be the world’s largest population.
U.S. President Joe Biden called the agreement “historic” and discussed it by telephone with Indian Prime Minister Narendra Modi – part of a flurry of high-level reactions as the scale of India’s needs provided a rare bonanza for both competing plane giants in an industry where the winner usually takes all.
The Airbus order includes 210 A320 Neo narrow-body planes and 40 A350 wide-body aircraft, which Air India will use to fly “ultra-long routes”, Tata Chairman N Chandrasekaran said.
Boeing will supply 190 737 MAX, 20 of its 787 Dreamliners, and 10 Mini-Jumbo 777X.
Together with another 25 Airbus jets to be leased, the overall acquisition reaches 495 jets, an Airbus executive said. Shares in Boeing rose 1.3% and Airbus rose 0.3%. The first aircraft to arrive will be 25 brand-new Boeing 737 MAX planes and six Airbus A350s in the second half of 2023, with deliveries really ramping up in 2025 and beyond.
“India is also sending a strong political signal that it wants to remain attached to the West at a time when it has appeared ambiguous on Russian sanctions,” said Grabowski, a former banker with extensive experience in international deals.
The deal includes a major win for engine maker CFM International, a joint venture between General Electric and France’s Safran. It has been selected to power 210 Airbus narrowbody jets ahead of rival Pratt & Whitney, while bigger jets will be powered by GE or Britain’s Rolls-Royce.
British Prime Minister Rishi Sunak said the deal would create new jobs. Air India, with its maharajah mascot, was once known for its lavishly decorated planes and stellar service but its reputation declined in the mid-2000s as financial troubles mounted.
The record order aims to put Air India in the league of large global airlines and make it an influential customer for plane makers and suppliers at a time when its home market is seeing a strong post-COVID-19 travel surge.
It reflects a strategy to recapture a solid share of trips between India’s cities such as New Delhi and Mumbai that are currently dominated by foreign rivals such as Emirates. It will also put Air India on a stronger footing to compete with domestic rival IndiGo, which has a majority share of the Indian market and a strong position in regional flights.
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