Air India orders 250 jets from Airbus
Air India has agreed to buy 250 jets from Airbus, part of a mammoth deal for 470 planes as the airline heralds a decades-long transformation under its new owners, TATA Group.
It is well known that Airbus’s registered headquarters is in Leiden, Netherlands, but its head office is located in Toulouse, France. The ‘SE’ in its corporate name means it is a social European, which enables it to be registered as a European rather than a national corporation. Its shares are traded in France, Germany and Spain.
The company’s main civil aeroplane business is conducted through the French company Airbus S.A.S, based in Blagnac, a suburb of Toulouse, with production and manufacturing facilities mostly in the European Union and the United Kingdom. Final assembly production is based in Toulouse, France; Hamburg, Germany; Broughton, United Kingdom and Seville, Spain.
So in one go relationship with France the closest European friend has been consolidated followed by Spain again a friend. Also Germany and England should now be falling in line. Any further anti India activities permitted by them from their soil under any garb of “ free speech “ or such “ great games “ will cost them heavily in terms of Euros….the language they understand the most. And this is just the beginning.
The Airbus order includes 210 of A320neo narrow body aircrafts and 40 A350 wide body aircraft, for Air India to fly “ultra-long routes across the globe,” TATA Chairman N Chandrasekaran said on Tuesday.
The combined 250 -jet order is the largest by a single airline. Coupled with roughly 25 more Airbus jets that Air India plans to lease to meet its immediate needs, it touches the 275-mark, confirming a scale first reported by Reuters in December.
So now India’s ambition to be one of world’s biggest aviation markets with its growing base of fliers and large diaspora across the world is going to be fulfilled.
The order also marks a turning point for Air India which, under new CEO Campbell Wilson, is working to revive its reputation as a world-class airline and shake off its image as a tardy, run-down operation with an ageing fleet and poor service. The passenger “ pi…ing “ days is going to be over.
“One of the most important things is a modern fleet which is efficient and can perform for all routes,” Chandrasekaran said during a virtual press briefing.
The online event was attended by Indian Prime Minister Narendra Modi and French President Emmanuel Macron, highlighting the political and economic importance of a deal involving India’s former flag bearer.
“This important deal shows, along with the deepening of relations between India and France, the successes and aspirations of the civil aviation sector in India. Today, civil aviation is an integral part of India’s growth,” Modi said.
Industry sources say India had repeatedly lobbied for Airbus to add a final assembly line in the country, matching a plant in northern China, but the Airbus has rejected the idea on financial and industrial grounds. Now this may soon come true because cancelation of such large order will harm others parties.
Meanwhile the aviation deal is expected to have other industrial spin-offs, with Macron pledging France will work with India beyond aircraft.
“This achievement shows that Airbus and all its French partners are fully dedicated to develop new areas of dedication with India,” Macron said during the video presentation.
Chandrasekaran said Airbus and TATA were working on bigger partnerships, including an ambition “to bring in commercial aircraft manufacturing at some point in time in the future”.
Even after significant expected discounts, the deal would be worth tens of billions of dollars at a volatile time for plane giants whose jets are again in demand after the pandemic, but who face mounting industrial and environmental pressures.
“It is important for the industry because given the recent turbulence in the China market, the alternative growth market is India,” said independent aviation adviser Bertrand Grabowski.
India is also sending a strong political signal to Europe at a time when they have got entrapped with the Russian Ukraine conflict and are at loggerheads with China. It is also a signal that in spite of Western sanctions, India will continue to trade with Russia but at the same time will also trade with the West if they offer favourable terns without strings attached.
The deal also includes a major commercial win for engine maker CFM International, a joint venture between General Electric and France’s Safran. It has been selected to power 210 Airbus narrow body jets ahead of rival Pratt & Whitney, while bigger planes will be powered by GE or Britain’s Rolls-Royce.
British Prime Minister Rishi Sunak said the deal between Air India, Airbus and Rolls-Royce would create new jobs.
“By building trade ties with growing economic powers like India we will ensure UK businesses remain at the forefront of global growth and innovation,” he said in a statement.
Air India, with its Maharajah mascot, was once known for its lavishly decorated planes and stellar service but its reputation declined in the mid-2000s as financial troubles mounted.
The record order aims to put Air India in the league of large global airlines and make it an influential customer for planemakers and suppliers at a time when its home market is seeing a strong post-COVID-19 travel surge.
It reflects a strategy to recapture a solid share of trips between India’s diaspora and cities such as Delhi and Mumbai that are currently dominated by foreign rivals such as Emirates.
It will also put Air India on a stronger footing to compete with domestic rival IndiGo, which has a majority share of the Indian market and a strong position in regional flights.
