Boeing sees soaring travel growth in India with $100bn order planned

Bengaluru — India’s airlines have bounced back well beyond pre-pandemic levels, Boeing said, as Air India, the country’s national carrier, prepared to unveil a historic order for almost 500 new planes on Tuesday.

The US company forecasts Indian airline capacity — the number of seats on offer and a gauge of industry confidence — will be 7% higher in the first half of 2023 than in 2019 thanks a strong rebound in the world’s fastest-growing market.

Over the next 20 years, Indian passenger traffic is expected to grow by 7% annually, requiring 2,210 new planes, Boeing said in a statement during the Aero India air show.

Air India, the former state-run carrier now owned by Tata Group, is poised to announce a deal on Tuesday for about 470 jets, worth more than $100bn at list prices, split between Boeing and Airbus, industry and diplomatic sources said.

The move is expected to include a deal for French-US engine maker CFM International, co-owned by General Electric and France’s Safran, to power more than 200 Airbus single-aisle jets included in the transaction.

None of the companies have comment on the deal, though it would lead to big industrial spin-offs for local suppliers at the air show, though the commercial deal-making is happening away from the mainly defence event.

On Monday, Boeing said it plans to invest about $24m in India to set up a logistics centre for parts to boost its footprint in the country that it considers as the third-largest domestic aviation market.

“The Indian market is recovering rapidly and its domestic capacity has exceeded 2019 levels, with domestic traffic expected to double by the end of this decade,” Dave Schulte, Boeing commercial marketing MD for Asia-Pacific, said in a statement.

Boeing expects 90% of India’s demand for new aircraft to be for single-aisle ones like the 737 MAX and competing Airbus A320neo over the next 20 years.

On the military side of India’s largest air show, state-owned Hindustan Aeronautics said it is in talks with at least four countries to sell its light-combat aircraft.

Reuters