Air India announced on Monday that it intends to finance its $70 billion order for a record-breaking 470 aircraft with internal cash, equity, and sale-and-leaseback transactions as the airline tries to quickly increase its footprint in international markets.
Air India announced
In a transaction that broke previous records for an order placed by a single carrier, Tata Group-owned Air India announced on Feb. 14 that it would purchase 220 planes from Boeing and 250 from Airbus.
Air India CEO Campbell Wilson said
“So the main reason (for the jet order) was realizing the possibility for Indian aviation and putting in place the investment in the capacity of the aircraft to fulfill that for India’s benefit,” said Campbell Wilson, chief executive officer of Air India, on Monday.
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We see enormous opportunity in the long-haul international market, he added, adding that the addition of the new order for 70 widebody aircraft to its existing fleet and additional leased aircraft will result in a “multiply increased widebody long-haul fleet, and consequently, capacity,” for Air India.
Due to financial difficulties, an outdated aircraft, and subpar service, Air India, previously regarded as a top-tier airline in India, saw its reputation tarnish in the mid-2000s.
Tata Group
The resurgence of the airline under the Tata company, which took over the once government-owned carrier last year, wants to take advantage of India’s expanding base of travelers and the significant number of people of Indian ancestry worldwide.
According to Campbell Wilson, there is untapped potential for direct flights to North America. He also stated that Air India would expand the frequency of its flights to European locations, including Frankfurt, Paris, and the United Kingdom.
To compete with more powerful rivals like Emirates, the airline is investing $400 million in reconditioning and modernizing its aircraft, particularly for long-haul flights.
Campbell Wilson stated that 500 new cabin crew members are being hired by Air India each month. Almost 4,200 cabin crew members and 900 pilots will be hired, the airline announced last week.
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