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Air India planning mega plane order

According to industry sources, Air India intends to order 425 jets, including 235 Airbus A320neo-family planes and 190 Boeing 737 MAX aircraft. The upcoming deal is expected to include 70 wide-body aircraft consisting of 40 Airbus A350s, 20 Boeing 787s, and 10 Boeing 777Xs. Once finalized, the deal would rank among the biggest by a single airline in volume terms, overshadowing a combined order for 460 Airbus and Boeing aircraft from American Airlines over a decade ago.

CargoForwarder Global reported:

Air India owner, Tata Group, said the order is the cornerstone to transforming the previously state-run carrier into a “world-class airline” within the next five years. This is urgently required, as the airline is known for poor service, repeated unpunctuality, and a number of scandals. Just recently,  the carrier was fined for its handling of an incident in which a drunk, senior U.S. bank executive was accused of urinating on a 72-year-old woman seated in business class on a flight from New York to New Delhi. The incident was named “peegate” by Indian media. In 2014, a Canadian court convicted Indian-born Canadian businessman, Nazir Karagir, for offering bribes to Air India officials to win a contract worth US$ 100 million. The money was paid from foreign shores to Air India officials to influence the contract in favor of the Canadian firm but was scrapped after the deal was unmasked by Canadian prosecutors.

Air India on way to becoming a “world-class airline”? – photo: courtesy Air India

Air India on way to becoming a “world-class airline”? – photo: courtesy Air India

Deal, or no deal?

Airbus declined to comment on the pending mega order. Neither did Air India or Boeing respond to media inquiries. According to people close to the case, details of the order have been successfully negotiated but finalizing the deal depends on ongoing negotiations with engine maker CFM International, the General Electric Co. and Safran SA joint venture. According to media agencies, CMF is reluctant to offer major discounts on engines and maintenance that typically accompany mega purchase agreements. So, the Boeing part of the order could be held up by an impasse with the engine producer of the 737 Max.

Regarding Airbus, its position in India as the leading supplier of narrow-body planes could be consolidated. So far, IndiGo, the country’s largest carrier, is the biggest customer for Airbus’ A320neo family. However, if the engine issue can be settled amicably, the order could be a breakthrough for Boeing as well, as the U.S. manufacturer has been lagging behind Airbus in the fast-growing Indian aviation market, where its customers include start-up Akasa Air, and SpiceJet.

In the meantime, Airbus has announced that the production rate for the A320 Family of narrowbody aircraft will be increased significantly. Most of the single aisle jetliners are traditionally built at the manufacturer’s Hamburg plant. This hint also points to the upcoming major order from Air India.Heiner Siegmund

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