Winning Bizness Desk

Mumbai. Air India, under Tata Group's ownership, is exploring the acquisition of Boeing aircraft originally destined for Chinese airlines. This move comes in response to escalating trade tensions between the United States and China, which have led Chinese carriers to halt acceptance of new Boeing deliveries. The Indian airline views this as a strategic opportunity to expand its fleet, particularly for its low-cost subsidiary, Air India Express.

Massive Aircraft Order to Modernize Fleet

In a significant move to revamp its fleet, Air India has placed a historic order for 470 aircraft, comprising 250 from Airbus and 220 from Boeing. The Boeing order, valued at $34 billion (approximately ₹2.9 lakh crore), includes 190 737 Max narrow-body jets, 20 787 Dreamliners, and 10 777X wide-body aircraft. This deal is Boeing's third-largest sale in dollar value and second-largest in terms of the number of planes.

Strategic Implications for Global Aviation

The US-China tariff war has disrupted Boeing's deliveries to China, with Chinese airlines instructed not to accept new Boeing aircraft. This development has opened avenues for other carriers, like Air India, to acquire these aircraft. While this may alleviate some of Boeing's short-term challenges, the long-term implications could see a shift in market dynamics, potentially benefiting competitors like Airbus.

Economic and Employment Impact

The Air India-Boeing deal is expected to have a substantial economic impact, supporting over one million American jobs across 44 states. US President Joe Biden has lauded the agreement as a testament to the strength of the US-India economic partnership. The deal also underscores the deepening ties between India and France, with Air India's simultaneous order of 250 Airbus aircraft.

Future Outlook for Air India

With these acquisitions, Air India aims to modernize its fleet and enhance its global competitiveness. The airline plans to utilize the Airbus A350s for ultra-long-haul routes and the Boeing 777X and 787 Dreamliners for expanding its international network. The narrow-body aircraft will bolster domestic and regional operations, positioning Air India to better compete with rivals like IndiGo.

Key Highlights:

• Air India is considering purchasing Boeing aircraft rejected by Chinese airlines due to US-China trade tensions.
• The airline has placed a record order for 470 aircraft: 250 from Airbus and 220 from Boeing.
• The Boeing deal, valued at $34 billion, includes 190 737 Max, 20 787 Dreamliners, and 10 777X aircraft.
• The acquisition is expected to support over one million American jobs across 44 states.
• US President Joe Biden and Indian Prime Minister Narendra Modi have hailed the deal as a milestone in bilateral relations.
• The fleet expansion aims to modernize Air India's operations and enhance its global competitiveness.
• The move reflects Air India's strategic response to global market shifts and its ambition to become a leading international carrier.