Indian airline Air India signed a giant deal to acquire 250 planes from Airbus and 220 aircraft from Boeing to meet the expected growth of the huge Indian market.
1. Economic partnership
The leaders of Airbus and the Tata group, owner of Air India, announced the agreement during a ceremony by videoconference on February 14, in the presence of Indian Prime Minister Narendra Modi and French President Emmanuel Macron, on the occasion of the AeroIndia exhibition in Bengaluru.
This important deal shows, along with the deepening of relations between India and France, the successes and aspirations of the civil aviation sector in India.Narendra Modi, Prime Minister of India
The commitment includes 140 A320neo and 70 A321neo single-aisle aircraft as well as 34 A350-1000 and six A350-900 wide-body jets.
Boeing will supply 190 737 MAX, 20 of its 787 Dreamliners and 10 mini-jumbo 777X. The first aircraft to arrive will be 25 brand-new Boeing 737 MAX planes and six Airbus A350s in the second half of 2023, with deliveries really ramping up in 2025 and beyond. US President Joe Biden said the deal was “historic” and congratulated the purchase which said it will create jobs for “one million American jobs across 44 states”, noting that “many will not require a four-year college degree”.
2. Fleet revamping
This giant deal represents a shifting moment for Air India, which currently operates a fleet of 115 aircraft and has not purchased new planes since 2006.
We celebrate a historic moment today as @GE_Aerospace gets ready to power @airindiain‘s future growth. Hear Air India and GE Aerospace leaders share their perspective about a milestone that promises to transform the future of flight in India.#GEinIndia pic.twitter.com/XTeHnLyJuA— GE in India (@GEIndia) February 14, 2023
Last year, on January 2022, the Tata Group won the bid for Air India taking over the airline from the government. CEO Wilson is now working to revive its reputation as a world-class airline and get rid of a shaky image and run-down operation with an ageing fleet and poor service.
Airbus has been a longstanding partner of Air India, and these new aircraft will play an important part in delivering Vihaan.AI, Air India’s comprehensive transformation and growth strategy.Campbell Wilson, CEO and MD of Air India
3. Booming market
A United Nations report has forecast that India is likely to dethrone China as the most populous country in April this year. By 2050, India is estimated to have almost 1.7 billion people. Its economy is poised to expand the fastest among the G20 nations, and a growing middle class is expected to spend more on air travel. As a result, passenger traffic in India will grow fast, including on the long-range markets in the US, Europe and Asia-Pacific.
“[The deal] is important for the industry because given the recent turbulence in the China market, the alternative growth market is India,” independent aviation adviser Bertrand Grabowski told Reuters.
I thank my friend @EmmanuelMacron for joining me at the launch of an important partnership between @airindiain and @Airbus that will further strengthen the Indian aviation sector and create opportunities in both nations. This reflects the robust Indo-French Strategic Partnership.— Narendra Modi (@narendramodi) February 14, 2023
Christian Scherer, Airbus Chief Commercial Officer and Head of International said India is “on the verge of an international air travel revolution” and welcomed the partnership rejoicing over the role of the company’s aircraft solutions which will “write that new chapter for the country’s air-connectivity”.