Air India is considering another substantial multi-billion-dollar order for widebody jets from Boeing and Airbus, signaling continued transformation under its new owner, Tata Group, according to industry insiders.

The discussions revolve around acquiring 30 to 40 aircraft, split between Airbus A350s and Boeing 777Xs, with one source indicating that the final order could surpass 50 jets. However, details remain fluid. "More clarity is expected as we approach the Paris Air Show in June," one source noted, speaking anonymously.

While an Air India spokesperson declined to comment on speculation, both Boeing and Airbus also withheld remarks.

This prospective order would supplement Air India's massive fleet expansion, which included a record-breaking purchase of 470 aircraft in 2023 from both manufacturers and an additional 100 Airbus narrowbody jets last year. Unlike those deals, which primarily focused on single-aisle planes, this widebody acquisition could significantly bolster the airline’s efforts to reclaim lost market share.

Currently, Air India has orders for 50 Airbus A350s, 10 Boeing 777Xs, and 20 Boeing 787 Dreamliners.

The move comes amid a surge in international passenger demand from India, projected to grow by 15-20% in the current fiscal year, outpacing domestic travel growth of 7-10%, as per ICRA, Moody’s local ratings agency. Airlines worldwide are also scrambling to secure production slots for widebody jets due to supply chain bottlenecks, intensified by the rising demand for narrowbody aircraft from fast-growing carriers like IndiGo.

Under Tata’s leadership, Air India's turnaround is being closely monitored by investors, aircraft manufacturers, and lessors after years of decline under state ownership. However, aircraft delivery delays are slowing progress.

Once renowned for its world-class service, Air India’s reputation suffered over the years due to financial struggles, an ageing fleet, and declining service quality. CEO Campbell Wilson recently stated that the global shortage of aircraft—exacerbated by supply chain constraints affecting engines, premium cabin seats, and fuselage components—could persist for at least four more years.

These delays have forced Air India to continue operating some older aircraft and have extended Tata's five-year transformation timeline. The airline is not alone in facing supply chain woes—Akasa Air, India’s newest carrier, is also dealing with disruptions, leading to idle pilots due to aircraft shortages.

Despite these challenges, Air India remains focused on reclaiming market share from international competitors like Emirates, Lufthansa, and Turkish Airlines, which have long attracted Indian travelers with their modern fleets and premium offerings.

Currently, Indian carriers hold a 43-44% share of outbound passenger traffic, while foreign airlines still dominate international routes, according to ICRA.

This year, Air India and its low-cost arm, Air India Express, are set to receive approximately 20 new narrowbody and widebody aircraft, as per UK-based consultancy Cirium Ascend.

Source: Reuters