Back in December 2022 we learned how Air India was nearing a record-breaking aircraft order. Several days ago it was revealed that contracts for this order had been signed, and today Air India has formally announced the order.
In this post:
Air India places biggest aircraft order in history
Air India was privatized just over a year ago, and is now owned by Tata Group. The carrier’s owners are trying to turn things around for the better. They’ve been making progress, though as you’d expect, the transformation isn’t happening overnight.
The biggest part of Air India’s transformation involves the airline placing a historic aircraft order for 470 jets, including planes from both Airbus and Boeing. Air India has finalized an order for the following aircraft (these are all firm orders:
- Air India is purchasing 250 Airbus jets, including 140 A320neos, 70 A321neos, six A350-900s, and 34 A350-1000s
- Air India is purchasing 220 Boeing jets, including 190 737 MAXs (including the -8 and -10 series), 20 787-9s, and 10 777-9s
Some planes will start to be delivered in late 2023, though we’re told to expect the bulk of deliveries starting in mid-2025. In addition to the firm orders, Air India has 70 additional options with Boeing, including for 50 737 MAXs and 20 787s.
At list prices, these deals are worth many tens of billions of dollars. Prior to this, the biggest aircraft order ever was from American Airlines roughly a decade ago, when the airline ordered 460 Airbus and Boeing jets. It would appear that Air India has just beaten that record.
As you can see, Air India isn’t going for fleet consistency with this order, but rather I assume the priority is securing orders with delivery slots in the not-too-distant future, which requires going with multiple aircraft manufacturers.
Arguably the most interesting part of this development is the Boeing 777-9 order. This is Boeing’s first 777X order in years, as the jet has been struggling with certification, and now isn’t expected to enter passenger service until at least 2025.
Ahead of these new aircraft deliveries, Air India has been leasing some planes to add capacity, including getting some former Delta Boeing 777s.
Tata Group seems serious about reinventing Air India
Tata Group was Air India’s initial owner when the company was founded in the 1930s, before it became government owned. I think it goes without saying that Tata Group is serious about turning the airline around, or else the company wouldn’t have bought a money-losing airline with endless issues.
Tata Group’s takeover of Air India was announced over a year ago, and initially not much changed. However, it seems that we’re finally now seeing what a transformation will look like.
At this point we know that Air India and Vistara will be merging, and that Singapore Airlines will be taking a roughly 25% stake in the airline. It has also been announced that Air India will be spending $400 million updating the interiors of its long haul jets.
For context on the scale of Air India’s aircraft order, Air India and Vistara currently have around 220 planes combined. This makes the company the largest international airline in India, and the second largest domestic airline, after IndiGo.
Tata Group now seems to be going all-in on a transformation. If enough money is invested in the airline, I have no doubt that Air India can have a modern fleet and competitive hard product. The question is whether the culture at the company can change, in terms of service, reliability, etc. Singapore Airlines being involved certainly gives me some hope.
If Air India can actually be turned into a good, profitable airline, it might just be the greatest airline turnaround story ever. But that’s also still a big “if” for now.
Bottom line
Air India has announced an order for 470 aircraft. This order is split between Airbus and Boeing, and includes the Airbus A320neo, Boeing 737 MAX, Airbus A350, Boeing 787, and Boeing 777X.
Air India’s transformation is going full speed ahead, between the merger with Vistara, Singapore Airlines’ ownership stake, long haul cabins being refreshed, and now this. I can’t wait to see how this all plays out.
What do you make of Air India’s aircraft order?
Congratulations! This marks a new era for Air India. I had always viewed this airline in the past couple of decades as this corrupt government-run political toy that was in the same league as the pre-bankruptcy SAA or pre-ITA Alitalia and doing better financially just because there is a particularly large worldwide Indian diaspora willing to take the nonstop flights that gave them a reliable flow of traffic. It did not represent well what India...
Congratulations! This marks a new era for Air India. I had always viewed this airline in the past couple of decades as this corrupt government-run political toy that was in the same league as the pre-bankruptcy SAA or pre-ITA Alitalia and doing better financially just because there is a particularly large worldwide Indian diaspora willing to take the nonstop flights that gave them a reliable flow of traffic. It did not represent well what India could be. The best thing about it was easily its livery. I hope SQ and TATA can transform this airline into one that can be competitive with the world's premium airlines while incorporating elements that showcase the great things India has to offer.
Only one thing I can say: "Incredible !ndia" (in the tune of their commercial)!
The TATAs command deep respect and admiration in a way that no company nor brand has managed in India, and that too for over 150 years. The TATAs are not just a company, but have always been invested in making a positive difference in India and prefer to be recognized as industrialists. When they founded the airline, the splendor and service, were second to none globally. With their deep pockets and the reputation of the...
The TATAs command deep respect and admiration in a way that no company nor brand has managed in India, and that too for over 150 years. The TATAs are not just a company, but have always been invested in making a positive difference in India and prefer to be recognized as industrialists. When they founded the airline, the splendor and service, were second to none globally. With their deep pockets and the reputation of the TATA Sons' badge, I am certain that AI is fully vested in returning AI to its glory.
I recently flew LHR-DEL on AI and was very impressed with the service, quality of wines and meals, and the attention to detail. The hard product left much to desire, but I still managed a restful journey. I guess the TATAs are making am impact through their fine-tuning.
Air India should include Airbus 321 XLR in the order.
IndiGo does have international operations.
Tata probably have the skillsets to pull this off, although the diversity of aircraft adds expense and lack of robustness - look at Emirates, let alone SouthWest and Ryanair.
But I think the big question is whether the government will keep out of the way to let Tata manage it (including insisting on high standards from staff, and not holding departures for ministers)
And then there is a potential price ware with the ME3.
You can’t buy your way to success in airline world.
You can put new planes but you just cannot invent a new culture.
The culture of SQ is embedded in their DNA. The politicians in India are corrupt and that means the tenders and business of running the airline will be corrupt.
Oh! I hope I am wrong.
I don’t plan to travel on AI in this lifetime, I rather pay extra and take SQ and detour via Singapore.
I want to add that other airlines especially non-Indian airlines will be upping their game. AI will do just fine in India and serving labor to gulf countries but Europeans will up their game and so will Emirates and Qatar. SQ might not compete directly with AI and will help with codeshare, stop flying to India and let AI bring traffic to and from Singapore.
Oh no, AI is devastated. Their business case is doomed now since you won't fly them.
P.S. - All the drivel about Indian corruption misses the mark since the government no longer owns AI.
You are so right. As this is Tata’s first foray in India, they have so much to learn about operating a business in India.
@Guri S - Why don't you just stop traveling to India? I am sure no one will miss you. Oh and for the record, the Europeans have stopped upping any games since they are all cash-strapped and are at this point basically decaying due to a regressive econonmy. Good luck in your next life!
At the time of AA's 2011 order, AA's fleet size was around 620, so order was about 74% of the fleet size and it was all narror body planes (and just B737 and A320 families).
The Air India order is more than 4 times of their current fleet size (113) and composed of 5 different families of aircraft.
I am curious to see how they are going to manage this...
What's the domestic market like for aviation in India? They have a massive population, obviously, but do they see the same degree of domestic travel as China? What share of intercity travel is still done by train?
They have several huge economic hubs and a booming middle class. You'd think their domestic aviation sector would be booming right alongside it. Yet Air India has lagged and sputtered for decades. Is it because of the...
What's the domestic market like for aviation in India? They have a massive population, obviously, but do they see the same degree of domestic travel as China? What share of intercity travel is still done by train?
They have several huge economic hubs and a booming middle class. You'd think their domestic aviation sector would be booming right alongside it. Yet Air India has lagged and sputtered for decades. Is it because of the broader Indian economy, or is it just mismanagement at one airline?
There was a 47% increase in Indian air passengers last year, with more than 123 million people flying domestically.
Per WSJ, Boeing expects India to require about 2,210 new aircraft over the next 20 years.
This is great news- India is an undeserved market and the Tatas certainly have the pockets and expertise to give India a world class airline.
Having said that, I am curious about some of the widebody fleet choices. India is a dispersed market spread over a lot of cities much like the US. Air India’s main competing advantage would be to offer point to point to point international services to dislodge the dominance of...
This is great news- India is an undeserved market and the Tatas certainly have the pockets and expertise to give India a world class airline.
Having said that, I am curious about some of the widebody fleet choices. India is a dispersed market spread over a lot of cities much like the US. Air India’s main competing advantage would be to offer point to point to point international services to dislodge the dominance of ME3 and European carriers. Simply put, for a passenger flying from Kolkata to Frankfurt, transiting in Delhi offers no benefit vs Dubai or Amsterdam. If anything transiting at an overseas pint would be more seamless.
Intuitively the 787-9 or even the A359 should have formed the backbone of their fleet as they can serve a multitude of routes across North America, Europe, Oceania and Asia Pacific from key cities in India.
The incremental capacity of the 350-1000s would be relevant for trunk routes from Delhi and Mumbai- London, New York, San Francisco, Singapore and possibly Toronto. I would have thought they would have done 50-70 787s or 359s and possibly 20-30 350-1000s.
Considering Air India’s cabin configurations are likely to have a lot less premium capacity vs BA, SQ or United, mid sized jets would be better suited.
I am all the more surprised with the 10 777xs. It’s a really small sub-fleet without much benefit particularly if the 350-1000s will eventually go 10 abreast. No surprises if Air India eventually swaps these for more 787s.
While the XLR is a great aircraft, I don’t see it opening many new routes for Air India. Its range will only allow Air India to cover European cities from Delhi and possibly Mumbai where wide bodies would be better suited. It simply doesn’t have the range to service thinner routes between Europe and the Southern cities. Moreover the operating economics of the 321xlr work best on higher yield thinner routes- India tends to be lower yield on most international routes. Given that the A321neo offers sufficient range for Air India to cover most destinations across Asia Pacific, I don’t see much need for the XLR.
Let’s see how this plays out- I wouldn’t be surprised to see this composition evolve over time.
I also think that the composition of plane types is a bit strange.
You make good points.
First, AI has no choice geopolitically but to split the order between Airbus and Boeing.
The B787-9 is the longest range Boeing model that is currently being delivered and is certified. The B777X is risky for an airline that wants to build their fleet.
The A350-900, while larger is not that much larger than the B787-9. I doubt if there are that many airlines that would order the...
You make good points.
First, AI has no choice geopolitically but to split the order between Airbus and Boeing.
The B787-9 is the longest range Boeing model that is currently being delivered and is certified. The B777X is risky for an airline that wants to build their fleet.
The A350-900, while larger is not that much larger than the B787-9. I doubt if there are that many airlines that would order the A350-900 and the B787-9 unless there are political factors in play.
I suspect that the A350-900s in the AI order are aircraft produced for other airlines including Aeroflot which cannot be delivered and Airbus is selling them at a discount. I suspect that Aeroflot paid deposits that are being withheld by Airbus so essentially Aeroflot is subsidizing AI's A350-900s. Those aircraft are fairly readily available but will not be configured the way AI wants but with SU's interior. The lag time for cabin fixtures including seats is as long as it takes to actually build the plane.
However, the A350-1000 has essentially the same trip costs as the -900 but carries more revenue and can fly further. If an airline thinks they can fill the seats at fairly low incremental fares, it makes sense to buy the larger aircraft. Given how much demand is leaking to the Middle East carriers and AI can likely match or beat the Middle East airlines' costs, it makes sense to buy the A350-1000s. And, of course, India's travel demand is growing. if the -1000s are a little large now, they probably won't be in many years.
And the 787s are likely for smaller markets in India while the 350s are likely for hubs and medium sized cities to the largest global markets. Many cities in India, like in the US or China, will never support longhaul international service so there will be a need for hub flights on large aircraft.
This is fascinating, in that it's such a massive order and so much money is involved. It certainly implies that AI and Tata have very big plans. If there's a market where I wouldn't say that 460 new aircraft is excessive, it's India. Given the pure size of the population, India remains underserved and has a ton of potential for explosive growth in air travel. Perhaps moreso than anywhere else on Earth right now. So,...
This is fascinating, in that it's such a massive order and so much money is involved. It certainly implies that AI and Tata have very big plans. If there's a market where I wouldn't say that 460 new aircraft is excessive, it's India. Given the pure size of the population, India remains underserved and has a ton of potential for explosive growth in air travel. Perhaps moreso than anywhere else on Earth right now. So, as long as Tata manages this correctly, AI could be a juggernaut. Time will tell.
indeed.
The real "loser" if there is a loser is the Middle East airlines that have been the default "national" airlines of India. This should dramatically reduce the leakage of passengers to them
I don't think so. The market will grow so much that there weilly enough for all the players, but I think we will see some shift of West coast US travel to SQ/AI as we've already seen.
The real problem is that there will be no FSC competition to Air India, especially no frequent flyer program, Jet Airways doesn't seem to being taking off.
Regarding your statement that Jet Airways doesn’t seem to be relaunching, yes, they have been hit by setback after setback since October, as they have had to pay a lot of extra dues on top of what was planned. But you can’t rule them out, and hopefully by the summer we should have a much clearer picture on where they stand in terms of fleet and pricing model.
I agree, I love the Jet Airways and want their comeback very much. In the face all the headwinds they've been facing Sanjiv has done a great job with the publicity and media side, but it's hard to not lose hope after this long.
This is a MASSIVE order. But India is like the US in that it has several mid-to-large cities with capacity for international point-to-point travel. And the Economy is only growing.
The big question to my mind is whether they can raise their reliability sufficiently so that customers don't continue to drain to Emirates, Qatar and other carriers. And new shiny planes help, but management needs to shine too.
I flew with AI in December and January J in 777 and 787. I had flown with them back in 2014 Y as well. I can confirm they are not toying around. Their hard product wasnt the most aesthetically pleasing but their service was awesome! The crew was very attentive. I just booked another flight for December 23 cant wait to try them again after more than a year of TATA's ownership
Tata is doing the Government a great favor by taking this monstrosity of their hands. Tata will actually be able to make the airline competitive. Never underestimate them..In return, Tata will secure favorable relationships with the Government.
Government owned is not the problem. Look at Singapore Airlines for example.
Actually it is. Virtually zero corruption in Singapore versus years upon years of systemic corruption at Air India...and I agree with other comments, if there's a company that can turn around AI, its Tata.
Go tata all india is with you guys
Tmr will be world with you
Good Decision for Tata Group ❤️
I do not think I will go a flight with 737 Max ever. Air India should not buy these for safety reasons. Its scary !
I've flown on a bunch of UA MAXes ever since they were cleared. I'm not dead. The MAX is now one of the safest planes in the sky.
Ordering the Max is a mistake.
They should have stayed with 1 family - Airbus for all short -medium haul and kept just the 787 for thin routes to EU and US
The only reason to buy Boeing was political and they could have done that by keeping the 787 order larger.
Air India Express operates the 737-800 exclusively, the MAXs are probably for them
They are trying to get the earliest slots they can. That explains a split order between Boeing and Airbus.
I thought public opinion is against "putting all eggs in one basket".
If these numbers are right, it seems that the A350 will form the backbone of their longhaul fleet. While I like the A350s, as an AVGeek, I'm disappointed they won't have more 777-Xs. I'm hoping perhaps the 10 orders are a placeholder and they'll re-evaluate once it's released and actual performance numbers are available.
That said, right now the A350 is comfortable due to being 9-abreast vs 777 10-abreast (Although AI is one of the...
If these numbers are right, it seems that the A350 will form the backbone of their longhaul fleet. While I like the A350s, as an AVGeek, I'm disappointed they won't have more 777-Xs. I'm hoping perhaps the 10 orders are a placeholder and they'll re-evaluate once it's released and actual performance numbers are available.
That said, right now the A350 is comfortable due to being 9-abreast vs 777 10-abreast (Although AI is one of the few to have 9-abreast in their 777s). If they put 10-abreast in the A350, it will be miserable.
I also wonder if some of the A320s end up being XLRs. Given how many medium/long-haul destinations there are from India (basically all of Asia) that don't need ULH range, they could leapfrog their competition and move to the future of longhaul narrowbody service, especially with a good cabin layout.
Anyway, good on the Tatas for going big. Now they just need a new cabin design and I think they're on their way to becoming a contender.
The A350 is certified and being delivered to customers right now; AI seems to want planes now and there is a good chance that Airbus could be able to deliver some whitetails as part of the order - perhaps the Aeroflot A350s that cannot be delivered due to sanctions.
The 9 abreast 777s are a result of the way Delta configured them; the planes are still in the Delta configuration with essentially just Delta branding...
The A350 is certified and being delivered to customers right now; AI seems to want planes now and there is a good chance that Airbus could be able to deliver some whitetails as part of the order - perhaps the Aeroflot A350s that cannot be delivered due to sanctions.
The 9 abreast 777s are a result of the way Delta configured them; the planes are still in the Delta configuration with essentially just Delta branding removed.
It is doubtful that many carriers will fly the A350 in 10 abreast because it isn't as wide as the 777 but Airbus is making that configuration possible
Also, the newest A350s moved the rear pressure bulkhead back and the crew stairwell and other components at the front of the aircraft forward to increase cabin space even if airlines don't go with 10 abreast.
@Tim - Old AI 777s still have 9 abreast and have been operating that way for a long time, even in the existing ones pre-DL 777s they recently acquired. Unless you meant something else.
correct. In addition to the 777-300ERs, AI had a fleet of 777LRs, retired most of them, and are in the process of regaining more as part of picking up the ex-Delta 777LRs.
Also, it appears the A350-900s that were built for Aeroflot might be part of the order. There are only 6 A350-900s and Airbus has about that many that were built for Aeroflot and possibly other airlines that they cannot deliver due to sanctions.
correct. In addition to the 777-300ERs, AI had a fleet of 777LRs, retired most of them, and are in the process of regaining more as part of picking up the ex-Delta 777LRs.
Also, it appears the A350-900s that were built for Aeroflot might be part of the order. There are only 6 A350-900s and Airbus has about that many that were built for Aeroflot and possibly other airlines that they cannot deliver due to sanctions.
Thus, some of the orders could start coming fairly quickly
The 777X order might be placeholders only to secure production slots. The A35K, especially in 10 seats abreast configuration, looks to be the superior solution. The 777-9 is big heavy plane. It has a weight penalty of +30 tons compared to the A35K, and it's larger size has more drag then the A35K. Even extra body freight can't make up for the higher operating cost. Therefor the 777-9 order is looking more like a political...
The 777X order might be placeholders only to secure production slots. The A35K, especially in 10 seats abreast configuration, looks to be the superior solution. The 777-9 is big heavy plane. It has a weight penalty of +30 tons compared to the A35K, and it's larger size has more drag then the A35K. Even extra body freight can't make up for the higher operating cost. Therefor the 777-9 order is looking more like a political statement, and they ordered just enough to operate it on two routes. Question is more, will they still keep up the order, if the A350's are performing as promised by Airbus? With the current delays and backlog 777-9 deliveries for AI might fall into 2026-2027 time frame. That's a long time out.
Air India made money on short haul international e.g. Delhi-Dhaka and lost huge amounts of money flying to Australia (mainly students). So ordering mainly 737/A320 makes sense. The 777X has high cargo capacity so can make routes that are valuable for freight pencil with lower loads/lower fares.
About time Air India got new planes, we look forward to have a good airline fly nonstop to Canada.
Today our only choice is Air Canada and they have a substandard Business class and horrible on time performance. Let alone luggage is often sent via London and it delayed by days.
"Tata Group seems to be serious about reinventing Air India"
I would call that quite an understatement.
Tata Group didn't buy AI to toy around with a few planes and a couple of prestige routes, like some spoiled billionaire. They're in this to make money. Seriously BIG amounts of money. India is a massive market that even now is still relatively untouched with a middle class that has never contracted, but kept on...
"Tata Group seems to be serious about reinventing Air India"
I would call that quite an understatement.
Tata Group didn't buy AI to toy around with a few planes and a couple of prestige routes, like some spoiled billionaire. They're in this to make money. Seriously BIG amounts of money. India is a massive market that even now is still relatively untouched with a middle class that has never contracted, but kept on growing. If Tata strategizes smartly, the local market could form the mainstay of revenue on both domestic and international routes. Foreign pax would just be the icing on the cake (unlike Emirates, Qatar and Etihad which specialize in carrying mostly foreign pax). I know enough about Tata to know they're not idiots. You don't get to be obscenely wealthy and get massive portfolios by being idiotic for over 100 years. If anyone can do the job, it's Tata.
It will be interesting to watch, especially given how much of Emirates and Qatar built their business model around traffic to/from India. If Air India can actually develop into a quality, reliable carrier they would have the ability to leverage the natural advantage they own as the Indian carrier. This would likely spark a huge price war which could provide some great deals to India in coming years.
I wonder when the 10 777X suppose to be delivered?
Airbus has a real answer to the 777X with A35K in 10 seats abreast configuration, that is less comfortable then the wider 777X cabin, but the economics is unbeatable.
Will Air India still receive the 777X at the end of the decade, if the A35K turns out to be the more efficient solution?
I think it's just like when the Chinese orders a few Tu-204 back in the early 2000s, just to complete to rest of the Su-30s,IL-76s. and never expect them to go into revenue services. Funny enough, B-2871 was the only one delivered, the others were still in Amur up to this day.
The cabin of the 777X can be wider however the cabin of the A350 stays in a much lower cabin pressure, it's humid (the 777 is so dry) and especially is way quieter than the 777 (which is the noisest cabin in the market). There is no comparation on those terms.
I do not think i will ever set foot on an Air India aircraft, but I hope Boeing can make some money off this.
190 737 Max8 - are Indian Pilots certified on this?
What kind of a dumb question is this? There are several airlines in India operations MAX
You might consider the question about the certification as dumb, and others might consider your attitude as arrogant, superficial!
Because other airlines have some 737 MAX in their fleets doesn't mean, that the main stream of young pilots are trained and certified on 737 MAX. It's more likely they got are familiar with a previous version of the 737.
You are allowed to use your brains, should you have some, before you write.
We also know that the 737MAX has a major challenge in terms of the computer-v-pilot interface.
One can argue whether it should be flying at all.
But that certainly introduces a higher risk for a fast expansion.
And I can't see Air India recruiting pilots from elsewhere.
Although per other story, the USA, and various other markets. also have issues with relevant experience in variosu sectors due to Covid redundancies.
operating*