Deal Builds on Antecedent 200-Jet Boeing Deal

On 14 February 2023, Air India, the New Delhi-based Indian national airline, announced its intention to acquire 250 Airbus aircraft for purpose of bolstering its domestic and international operations. The commitment includes 140 A320neo and 70 A321neo single-aisle aircraft, as well as 34 A350-1000 and six A350-900 wide-body jets.

In conjunction with a similarly extensive order for upwards of two-hundred Boeing narrow and wide-body jets, the acquisition occasions the revitalization of Air India’s fleet and the carrier’s ascension to the upper-echelon of global airlines.

The order aims to contemporaneously modernize and expand Air India’s fleet in support of the airline’s aspirations to capitalize on India’s large but under-served domestic air-travel market—which is dominated at present by budget carrier IndiGo. Air India seeks, also, to assert its presence among India’s international air travelers, the collective needs of which are currently and primarily met by Middle Eastern carriers the likes of Emirates and Qatar Airways. 

Deliveries of the new Airbus aircraft are to commence in short-order, with the first A350-900 slated to pass into Air India’s possession before year’s end.

Air India managing director and CEO Campbell Wilson stated: “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.”

Mr. Wilson continued: “A core element of this transformation is the significant expansion of our network, both domestically and internationally, coupled with the elevation of our on-ground and onboard product to world-class standards. This order marks the start of a new chapter for both Airbus and Air India.”

Airbus Chief Commercial Officer and Head of International Christian Scherer set forth: “This is a historic moment for Airbus and for Air India. India is on the verge of an international air travel revolution and we are honored that our partnership with the Tatas and our aircraft solutions will write that new chapter for the country’s air-connectivity. The A350’s unique capability will unlock the pent-up potential of India’s long-haul market, its technology, long reach, and second-to-none comfort will enable new routes and passenger experience with better economics and enhanced sustainability. Alongside the A350s, the A320 family fleets will be the efficient, versatile asset to continue democratizing and decarbonizing air travel in the country—from domestic, regional, up to international levels.”

Mr. Scherer added: “We salute Air India for its visionary strategy, picking the two reference aircraft types in each of their categories. We are thrilled and humbled to see these aircraft become the cornerstones of Air India’s renaissance. This fleet will propel the airline globally where it deserves to be—with the best.”

Sociologists posit India, over the coming decade, will surpass China as the world’s most populous country. The Indian economy is predicted to lead all G20 nations in expansion, and a burgeoning Indian middle class is expected to spend increasingly on air travel.

In October 2022, Air India, was acquired by the Tata Group, a Mumbai-based, Indian, multinational conglomerate with a combined market capitalization of $311-billion.

By virtue of its landmark agreements with Boeing and Airbus, Air India has assertively established itself among the world’s foremost airlines, thereby strengthening its influence over plane-makers and aerospace suppliers.

Analysts contend Air India will win passengers from rival Middle Eastern carriers, but not before the modernity of its fleet and the quality of its service equals the surpassing standard for which airlines the likes of Etihad, Emirates, and Qatar Airways are renowned.

In the near-term, however, Air India has afforded itself the capacity and aircraft capability by which to actualize its lofty ambitions both within and without India, and avail itself of the subcontinent’s immense economic opportunities.

FMI: www.airbus.com