Airbus pips Boeing, bags $2-bn order from Indian Airlines

The Indian Airlines order is also expected to energise the world aviation industry which was facing continuous order cancellations due to September 11 US attacks. The acquisition of aircraft became essential for Indian Airlines which saw its market share falling to around 50 per cent due to lack of new generation aircraft and increased fuel costs. Alliance Air’s Boeing 737 crash in Patna further expedited the airline’s acquisition plan.

The airline—which made a loss of Rs 159 crore for the fiscal ended March 2001—will utilise the new aircraft to introduce new connections both within and outside the country. The earlier order to buy 30 Airbus 320s was taken by late Prime Minister Rajiv Gandhi in 1986 which was mired in controversy over allegations of kickback payments. A CBI investigation is still on.

Dr Kiran Rao, vice-president, sales of Airbus, said that they have already delivered an aircraft to IA earlier this month, taking the total deliveries over the last one year to six. Airbus is also leading the race to win an order from the Indian Air Force which is planning to buy three aircraft worth $150 million for VIP flights. “We have submitted our technical and financial bids, and negotiations are currently at the technical stage. Each of the jets will cost around $50 million each,” says Rao. Talking to The Indian Express, a spokesperson of Ministry of Defence said ‘the bids are expected to be opened in the coming week’.

Airbus has a large maintenance, training and spares service network for its Airbus Corporate Jets in India which gave it a clear lead over Seattle-based Boeing. “We have a strong advantage over Boeing… as even Jet Airways and Sahara which are using Boeings have to send them abroad for major works.”

On Air-India, Rao added that talks were on with the airline for dry-leasing of three additional A-310s.