Air India is set to place a historic order for 500 jets, ranging from Airbus to Boeing, worth several billion dollars, a Reuters report said, citing sources. The move comes months after the Tata Group officially took over the airline from the Indian government following a 18,000 crore ($180 billion) deal.
Recently, the Tata Group recently announced the merger of Air India with Vistara, its joint venture with Singapore Airlines. This has created a significant presence in the domestic and international markets. The order includes at least 400 narrow-body jets and several Airbus A350s as well as Boeing 787s and 777s, according to reports. If the deal is signed, it will be an unprecedented order. American Airlines’ purchase of more than 460 Airbus and Boeing jets a decade ago is its largest order to date.
However, despite significant discounts, it will cost the company $100 billion dollars to buy these planes. Demand for larger aircraft has increased as passenger demand has increased following the easing of COVID-19 pandemic controls amid mounting industrial and environmental pressures.
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If the purchase of additional 500 jets is finalised, it will contribute significantly to the Indian economy. It is also one of the largest aviation markets in the world. It will also contribute significantly to Indian Prime Minister Narendra Modi’s goal of expanding the economy to $5 trillion.
Earlier this year, Tata acquired debt-ridden Air India from the Indian government, nearly seven decades after it was founded by JRT Tata in 1932 and then nationalized. The Tata Group, at the time of acquisition, had invested Rs. 2,700 crore ($27 billion) in cash. It also assumed over Rs 15,300 crore ($153 billion) in airline debt.
So far, there have been several reports of Tata-owned Air India making a major purchase. But the company and the airlines refused to comment on it.
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