Air India makes record-breaking purchases from Airbus and Boeing
Air India has agreed to buy 470 planes from manufacturing rivals Airbus and Boeing, the biggest order of new passenger aircraft in history, as it bets on the rapid expansion of air travel in Asia.
The airline, owned by Indian conglomerate Tata Sons, will buy 250 planes from European aviation champion Airbus and 220 from its US rival Boeing, its chairman announced on Tuesday.
Airbus will deliver 210 of its narrowbody A320 family, and 40 of its A350 wide-body aircraft, which are generally used on longer routes. Boeing will provide 190 of its narrow-body 737 Max jets, plus 20 of its 787 Dreamliner and 10 777 wide-body planes.
Airlines around the world suffered steep losses during pandemic lockdowns, but demand for air travel has surged back as travel restrictions have eased. The number of airline passengers in Asia is expected to rise markedly in the coming decades as countries become richer, although the increased traffic is expected to push up global aviation carbon emissions.
The Air India deals – together thought to be the largest in civil aviation history – are part of a turnaround plan by Tata, the owner of carmaker Jaguar Land Rover and Tetley’s tea in the UK, after it took back control of the struggling airline in 2022.
The carrier was founded in 1932 as Tata Airlines, before being nationalised in 1953. However, in recent years it had fallen into financial difficulties.
The deals were placed with support from the highest political levels. Indian prime minister Narendra Modi and French president Emmanuel Macron joined Tata family member Ratan Tata, Tata’s chair, Natarajan Chandrasekaran and Airbus chief executive Guillaume Faury in a video announcement. The US president, Joe Biden hailed the Boeing order on Tuesday.
The deal surpassed a 2017 order by Indian rival IndiGo for 420 planes, and an order by American Airlines for 460 planes in 2011. At list prices the Air India order would be worth tens of billions of pounds, although the airline would also benefit from steep discounts typically available for very large orders. The actual prices paid by airlines are a closely guarded secret.
The UK government was involved in the talks with Airbus, albeit several months ago. Rishi Sunak welcomed the Airbus deal, which the company said was worth “billions of pounds” for the British economy.
All of the wings for the Airbus planes will be produced at Broughton, north Wales, while the Trent XWB engines for the A350 wide-body planes will be manufactured by Rolls-Royce in Derby. It is thought about half of the value of the A350 will be produced in the UK.