Mumbai4 minutes ago
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Tata Sons’ Air India has finalized an order to buy 500 aircraft. The order includes 430 narrowbody and 70 widebody aircraft, and will be delivered over the next seven to eight years. Economic Times has published a report regarding this, quoting people related to this matter. This order is for Air India, but it will also be for low cost carriers Air Asia and Air India Express.
Airbus has a large part of this order
According to the report, European manufacturer Airbus has bagged a major part of this order. Airbus will fulfill the order for 240 A320 Neo and 40 A350 aircraft, while Boeing will supply 190 737 Max, 20 787 and 10 777x aircraft. Its formal announcement is expected to be made next week. Its value is around $ 150 billion, but discounts are quite common in such big deals.
Deal with Airbus in meeting on Friday
The report said that the deal with Airbus was finalized in a meeting on Friday. Tata Sons Chairman N Chandrasekaran and Airbus Chief Commercial Officer Christian Scheer attended. The deal with Boeing was signed on January 29 at Bombay House, the headquarters of Tata Sons in Mumbai. Apart from this, the airline has also signed deals with two engine makers.
Airbus dominates the Indian market
Airbus dominates the Indian market. India’s civil aviation market leader Indigo is the world’s largest customer of the Airbus A320. Winning such a huge order for narrowbody aircraft in India would be a coup for Boeing. Air India’s deal with Boeing and Airbus is being called the Mother of All Aviation Deal.
Air India will compete with Indigo
Air India will be able to provide short-haul destination service of 4-5 hours with the narrowbody plane. With this, it will be able to give a tough competition to Indigo, which currently occupies more than 50% of the domestic market. The Wise Body aircraft will help Tata expand its footprint in North America, Europe and Australia. Air India is likely to add around 50 aircraft by the end of FY24, which will increase its capacity by around 50%.
Target of 30% market share in 5 years
Since acquiring Air India early last year, the Tata group has been in talks with aircraft manufacturers to improve its fleet. Recently, Air India’s Chief Executive Officer Campbell Wilson had said that Air India wants to increase its market share by 30% on both domestic and international routes in the next 5 years.