Air India firms up $70bn orders with Boeing and Airbus for 470 jets at Paris Air Show

Tata-owned airline confirms its order for 250 Airbus aircraft and 220 new Boeing jets, following a preliminary deal in February

Air India aircraft at Indira Gandhi International Airport in New Delhi. AP

Tata Group-owned Air India firmed up orders for 470 Airbus and Boeing aircraft worth $70 billion at list prices during the second day of the Paris Air Show on Tuesday, as it forges ahead with a transformation plan under its new owners.

The airline finalised a purchase agreement for 250 Airbus aircraft. This entails a firm order of 140 A320neo and 70 A321neo single-aisle aircraft, as well as 34 A350-1000 and six A350-900 wide-body jets, Airbus said in a statement.

Air India also confirmed the purchase of 220 Boeing aircraft. This includes 190 of the company's 737 Max aircraft, 20 of its 787 Dreamliners and 10 of its 777X jets. It also signed options to buy another 50 737 Max jets and 20 787 Dreamliners, Boeing said in a statement.

The airline also signed service agreements with both manufacturers.

“Our ambitious fleet renewal and expansion programme will see Air India operate the most advanced and fuel-efficient aircraft across our route network within five years,” Campbell Wilson, chief executive and managing director of Air India, said.

N Chandrasekaran, chairman of Tata Sons and Air India, said: “This landmark step further positions Air India for long-term growth and success that, we have every hope, will come together to represent the best of modern aviation to the world.”

The deals by the New Delhi-based flag carrier on Tuesday finalise the preliminary agreements outlined in February with both manufacturers.

This move is part of Air India's plans to invest in fleet renewal, upgrade its services and grow its domestic and international route network.

These orders will also help the carrier offer long-haul flights directly from India, bypassing other regional centres, to serve India's expanding base of air travellers and massive diaspora, analysts said.

India dominated the Paris Air Show for two consecutive days with mammoth deals. The Air India purchase agreements came a day after domestic rival IndiGo agreed on Monday to buy 500 narrow-body jets from Airbus.

With one of the highest traffic growth rates in the world, India is the focal market for the global aerospace and defence industry and the world's most significant new aircraft market, Barclays said in a report on June 1.

Indian carriers now have the second-largest order book, with an over 6 per cent share of the industry backlog, behind only the US, the brokerage said.

Over the next 20 years, South Asia is expected to more than triple its in-service fleet from 700 to 2,300 aircraft to meet passenger demand, according to Boeing's commercial market outlook.

Air India's order marks the first entry into service of the Airbus A350 wide-body in India. Deliveries are set to start with the first A350-900 before the end of the year.