With this historic contract, Air India intends to become a world-class company.
Air India changes division. According to Reuters, the Indian airline acquired last year by the local conglomerate Tata has placed a huge order with Airbus and Boeing: around 500 aircraft for a dizzying bill of 100 billion dollars (93.5 billion euros) in price catalogue.
The contract could be unveiled this week at the Aero India show. Air India plans to acquire 250 Airbus – 210 A320neo single-aisle and 40 A350 twin-aisle aircraft -, and 220 Boeing – 190 B737 MAX single-aisle, 20 B787 and 10 B777X, larger. It is unclear if this is a firm order for all aircraft or if there are options.
Compete with the Indian company, Indigo
With this historic contract, Air India intends to become a world-class company. On its domestic market, it will be able to compete with the large Indian company, Indigo. It was about time: in 2022, Air India tumbled with only 8.7% of the domestic market when Indigo holds more than 50%. The former public company intends to re-capture 30% of the market by 2027. But India, which is expected to become the most populous country in the world this year, is a very dynamic market: it grew by 48.8% in 2022, up from 85.7% in fiscal 2019, the last before the pandemic. And, given the increase in the middle class but also the poor state of the roads, local air traffic should continue to grow this year.
With this order, Air India also intends to better serve the Indian diaspora who regularly return to the country. It will have the fleet to compete with Gulf companies, including Emirates. These aircraft deliveries are expected to occur over the next eight years.
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