Tata Group Buying 300 Narrowbody Aircraft From This Company
Tata group-owned Air India Ltd. is in the talks with Boeing for 300 narrowbody jets. If the deal is finalized, it will be one of the largest aircraft deals in history and a coup for Boeing as well.
HIGHLIGHTS
• Air India Ltd. considering buying 300 737 Max aircraft from Boeing in the largest aircraft deal ever
• Tata group is also talking with Airbus for Airbus SE’s A320neo
• The company could buy a mix of both aircraft or choose one
Which Aircraft Is Air India Ltd. Considering?
Ever since Tata group bought Air India Ltd. in the most high-profile privatization under PM Narendra Modi, it has been trying to increase its share in the Indian aviation industry. It is a premium group with lucrative landing slots at most major airports but it is facing tough competition from foreign airlines including Middle East carriers that provide non-stop services to India.
Earlier Bloomberg reported that the Tata group is close to finalizing a deal of Airbus A350 long-range jets capable of flying as far as the US West coast from New Delhi. But an official revealed on condition of anonymity that Tata group could order Airbus SE’s A320neo family jets or Boeing Co.’s 737 Max models, or a mix of both.
What Is The Payment Plan For Buying Aircraft?
If closed, the Boeing deal would cost the Tata group $40.5 billion at sticker prices. But production and delivery of 300 jets could take a decade or more. Airbus has the capacity to produce about 50 narrowbody jets in a year. But it has plans to boost its production to 65 by 2023 and 75 by 2025.
The order involves new methods of financing including factoring in the fluctuating rupee and rising inflation. The order will be placed on the most favorable terms on long-term maintenance that would help cut the running cost of aircraft and compete with rivals that offer cheap fares.
What Is The Boeing Status In India?
Boeing is eying a big order from Indian carriers as presently Airbus rules the Indian aviation market. With an order of 700 narrowbody jets, IndiGo is the biggest customer of Airbus followed by Vistara, Go Airlines India Ltd., and AirAsia Ltd. If Boeing gets the Tata group order, it will be no less than a coupe for the American aircraft maker.
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