Air India’s Big Bet: Decoding the Airbus and Boeing Deal!

Air India is all set to take off towards the skies of success after joining hands with Boeing and Airbus! Let’s explore more about it.

Last week, many prestigious people like US President Joe Biden, UK Prime Minister Rishi Sunak, French President Emmanuel Macron, and Indian Prime Minister Narendra Modi were totally engrossed in Air India’s massive deal.

But what was the curiosity all about?

Let’s find out.?

What’s Happening?

Air India is back in its new glory as it has placed an order for a whopping 470 aircraft. American President Joe Biden called this a landmark deal, and UK Prime Minister Rishi Sunak called it momentous.?

What is so exceptional about this deal? Let’s break it down.?

Air India has split 470 aircraft deal into two companies. Airbus, a UK-based company, has secured an order of 250 aircraft from Air India, bringing joy to the UK. Meanwhile, Boeing, a US-based company, received an order of 220 aircraft from Air India, making the US equally happy.?

Among the 470 aircraft ordered, 400 are narrow bodies, and 70 are widebody aircraft.?

To run these aircraft, engines are needed, and hence Air India has placed an order for 800 LEAP engines from GE Aerospace. Apart from this, Air India has also signed an MOU with Rolls-Royce for 68 Trent XWB-97 engines and 12 Trent XWB-84 engines.?

However, this did not happen overnight, Air India has been negotiating for over a year, and now they have signed the deal.?

Why is Air India Making Such a Big Purchase?

• Air India hasn’t bought any new planes since 2006, while all other airlines in the country have expanded. This has caused Air India to lose its domestic and international market position. To regain its market share, the airline company needs to buy new planes with greater capacity.
• Air India’s current planes also need to be replaced with modern planes that are better for the environment and use less fuel. This will help Air India save money and be more efficient and profitable.
• Lastly, who does not love discounts? Everybody does, and so does Air India. Ordering aircraft in bulk will help them get a good discount on the deal.?

What’s Next?

In 2022, Tata took over the struggling national airline, and things have been looking up since then. Before the takeover, the Tata group already had a fleet of 218 aircraft, including 52 for domestic travel and 38 for international flights. But with this new deal, Air India’s fleet size will be more than double, and it will successfully become the largest domestic airline in India, even surpassing Indigo’s fleet of 300 aircraft.

And that’s not all! The Air India and Vistara merger process has started. This will make Air India the largest Indian airline operating on international routes and the second-largest domestic airline after Indigo. This is a truly historic deal for India, and it’s exciting to see the positive changes happening in the aviation space.