Spice Jet to buy 50 Bombardiers for $ 1.7 billion
Spice Jet has firmed up its order for up to 50 Bombardier Q400 planes, giving a push to its regional connectivity plans. On Friday, the airline signed a purchase contract for the planes. It would also be the launch customer for extra-capacity 90-seat Q400 planes.
The purchase agreement includes 25 Q400 planes and rights for another 25 and based on the list price the deal is valued at $1.7 billion. Spice Jet signed a memorandum of understanding with Bombardier at the Paris air show in July. This is the largest-ever order for Q400 aircraft from any customer.
Deliveries would commence next year and the airline would induct 18 planes over the next three years. It did not disclose the financing model for its latest purchase, but its previous acquisition of 15 Q400 planes was funded through loans from Export Development Canada.
This is the airline’s second big order this year and comes eight months after it purchased 155 Boeing planes.
“SpiceJet operates India’s largest regional fleet and has always been a firm believer in the growth story of India’s smaller towns and cities. We have worked hard over the years to put these smaller towns on the country’s aviation map and will strive do the same in the times to come,” SpiceJet Chairman Ajay Singh said in a statement.
SpiceJet now operates 55 planes, including 20 Q400s. “We have been witnessing growth in the number of passengers per departure in the turboprop market, and especially in India. Today, Bombardier offers the largest turboprop aircraft available on the market and SpiceJet will be the first airline to take advantage of the profitable and efficient operations that the 90-passenger high-density Q400 will offer,” said François Cognard, Bombardier’s vicepresident, sales, South-Asia and Australasia.
SpiceJet has been awarded six proposals and 11 routes under the first phase of the the government’s Regional Connectivity Scheme Udan. Out of the six finalised proposals, four would cater to unserved markets of Adampur, Kandla, Puducherry and Jaisalmer whereas two would be for underserved markets of Porbandar and Kanpur.
Flight operations have commenced from July on the Mumbai-Kandla-Mumbai and Mumbai-Porbandar-Mumbai routes and Hyderabad-Puducherry from August.