Air India’s record aircraft deal is set to demonstrate the airline’s potential as a “world-class proposition”, all while creating and supporting jobs in the US and UK aerospace industries.
The order of 470 planes was so large that neither Airbus nor Boeing could win the entire commission while competing for the record deal, which beat American Airlines’ 2011 460-plane deal. Airbus will construct 250 jets, while Boeing will manufacture the remaining 220.
Chairman of Tata group Mr. Chandrasekaran said that the order was the first phase of Air India’s plan to “dramatically” expand its flight network. The national airway was re-acquired by the Tatas in 2021 for $2.4 billion, 68 years after the business had been bought by the Indian Government from the Tata group. Years of mismanagement of what was once a gold standard bearer had led to the airway becoming notorious for its debt, lack of human resources and chronic mismanagement.
Jitendra Bhargava, former executive director of Air India, told the BBC that “These orders will silence the critics of Air India’s disinvestment.” When asked what the future might hold for Air India under Tata leadership, he insisted that its “potential under the government was unexplored”.
The ripple effect of the deal is enormous. Parts manufacturers, including General Electric, Safran and Rolls-Royce will all receive new business as part of the commission. Boeing and Airbus have both confirmed that the order will support recently appointed roles.
US President Biden announced that the purchase “will support over one million American jobs across 44 states”, and added that while some roles would be highly specialised, many would not require a college degree.
UK Prime Minister Sunak announced that the Airbus portion of the deal “will create better-paid jobs and new opportunities in manufacturing hubs from Derby to Wales”. The manufacture of the plane wings alone is set to bring more than $120 million in investment to Wales.
So significant is the deal that analysts are beginning to believe that Air India’s bombastic intentions of rivalling the Gulf carriers, particularly Emirates, Etihad and Qatar Airways, might be feasible. The orders form part of Air India’s plan to synergise its fleet with Lufthansa and Singapore Airlines, the major players in the Star Alliance, the gulf carriers’ primary global rival. The inclusion of wide body aircraft in the deal will allow Air India to offer more direct flights to and from the U.S. and Australia, among other significant international long-haul destinations.