FINALLY! Its happened. Today’s a great day for Indian Aviation enthusiasts. TATA run Air India just ordered a massive order of Boeing aircraft including 190 737MAX, 737-8, 737-10 and 20 787-9 Dreamliners. The order also consists of 10 777-9 aircraft.
AIRBUS ORDERS
It has also announced a massive order worth 22 billion dollars (220 aircraft from Airbus). Total 470 Airbus and Boeing aircraft. The aircraft order is one of the biggest aircraft orders in history. DRUMROLL PLEASE
40 Airbus A350 aircraft! (34 A350-1000 + 6 A350-900)
210 Airbus A320neo/A321neo
NOTE: Air India currently has 220 aircraft, this order will increase that number to 690 aircraft!
Honestly, this is so refreshing and everyone has been waiting for this for so long. The benefits which this order will have on the future of Air India and the Indian Aviation market are incredibly. The modernisation of Air India’s fleet HAS BEGUN! (Hopefully we can see things improve now of course). The CEO of Air India says these aircraft will come into service by the end of THIS YEAR! (We can see them in the next 8-9 months).
Love seeing the 777X get some more orders, hopefully once the delays are worked out the thing can start getting delivered. It’s a great looking plane and can’t wait to see it in Air India’s livery!
Overall though, wow that’s a big order overall. Was rumored for awhile but nice to see it finally happen.
The slight problem is that Air India technically can’t afford these aircraft. They are losing billions of dollars a year, more each year than the last.
Honestly, at the rate they are losing money I wouldn’t be surprised if they go bankrupt in the next 5-10 years…
They can, actually. The TATA Group of companies is one of the largest and richest in India, if not the world. Air India now has a massive stockpile to pull from and some of the world’s best to help it grow. They even are already making progress growth up 64%. While there is still is a long way to go, Orders like this are vital to help the airline grow. All in all, things are looking up and up.
While they certainly cannot afford all these planes now, they could definitely be placing an order well in advance. Keep note that a lot of finance agreements with airlines, lessors or financial lessors, manufacturers and financial institution are unlikely to take effect until the aircraft is delivered. If anything, this is a good strategy to lock in future delivery slots to guarantee an airframe being delivered when the need arises.
Under the ownership of the Tata group, which in itself is an absolutely monstrous conglomerate, losses incurred in the short term are likely to yield a large return in the future. While everything behind curtains are never revealed for many obvious reasons, placing an order of this magnitude and with such grand ambitions would perhaps signal that this risk is well worth taking. Again, agreements between manufacturers and airlines are flexible and many individual conditions for the agreement would have been made well in advance, so both parties, and many others involved, would be aware of the risks and rewards at play here.
I think this is a distinction that should be made. Full service carriers are not necessarily direct competitors to budget airlines. Niches do exist in the market, for example, long haul budget travels. However, considering the budget aviation scene in India only consists of short to medium haul operators, perhaps with a couple of exceptions, this still does not shy away from the fact that major long haul destinations that Air India and its subsidiaries operate to, are often sole operators on said route. Routes to America and Europe are prime examples, in this case.
What I’m basically trying to out here is that this is not a short term game that Air India are playing. They’re in need of a fleet renewal strategy and while the expansion in the aviation scene may be set to arrive, if it hasn’t already, it’s also a very wide ranging agreement with various manufacturers to be able to guarantee any future changes to its operation if the need arises. Many other details are not covered in press releases, so the only thing we’re able to do, realistically, is speculate. That, in itself, would be a foolish thing to do.
It sure sounds like a market that is ripe for capacity upgrades:
Boeing expects India will lead traffic growth for a couple of decades at 7% per year.
That’s a world beating rate, and by a significant gap over other markets.
And India now has the largest population in the world.
That plus India’s per capital economic growth trajectory, gives weight to Boeing’s assessment. Per capita GDP:
This is very true. There’s very little competition Outside of India yes, there’s the Indian budget carriers on the short haul routes, but on long-haul routes, there’s only Air India Vistara And some European carriers and no US airline currently flies to India meaning that Air India with their 350s and 777X Could have a large market between the US and India expanding their US network which would be welcomed by a lot of Indian people living in the US for example, where I live in Dallas, there are a fair amount of Indian immigrants, but if they wanna go back to India on vacation or business they have to connect to Dubai or Doha if there was a direct route on an Air India, 777X that would boost Air Indias capital by huge margins
Incorrect, United currently flies Newark to Delhi, is launching San Francisco to Bangalore in October, and American also currently flies New York to Delhi.
They were, the government dragged air India through the mud and incurred heavy losses. Last year they put the airline on auction which was when the TATAs bought the airline back. They still have a massive funding source, just a different one.
