This past Wednesday, Boeing announced that the manufacturing giant had received type inspection authorization from the Federal Aviation Administration (FAA)…
Lessor: Air India Set to Order Around 500 Jets
According to a Reuters report, Air India is near an order of 500 jets through AirLease Corp, one of the largest aircraft lessors in the world.
“As a result of this recovery, there is now more momentum for large orders from airlines who have sort of sat back and watched the movie, and now they’re seeing there’s going to be a positive trend.” Steven Udvar-Hazy, executive chairman of AirLease Corp, told the Airline Economics conference.
“We have this 500-aircraft order coming out of India, which is going to be about 400 narrowbody aircraft, probably a mix of (Airbus) A320neos, A321neos and (Boeing) 737 MAXs, and 100 wide-bodies which will include (Boeing) 787s, 777X, potentially some 777 freighters and (Airbus) A350s.”
Industry experts say the deal is pending engine negotiations.
Final Assembly Line in India?
According to a separate report, the government of India is nudging Airbus and Boeing for airplane Final Assembly Lines(FAL) in India. The country forecasts a market for nearly 2,000 jets in the coming decade.
Planes for Jobs
Large orders from China and the US have prompted the construction of new FALs in the past. Chinese operators ordered 300 A320s in the two years leading up to Airbus’ announcement of its China FAL. American Airlines also made a headliner deal for 260 A320 family airplanes the year before Airbus’ US expansion. Lastly, the $38 billion order placed in 2015 by Chinese operators also led to the only Boeing completion center outside the US.
India is one of the fastest-growing aviation markets in the world. The largest airline in India, Indigo, currently holds orders for nearly 500 airbus airplanes. In addition to being the largest airline in India, the low-cost carrier is also the largest Airbus A320 NEO family operator.
While the pending narrowbody order will split between the duopoly, it’ll undoubtedly boost Airbus’s presence in the area further.
As of December 2022, Airbus holds orders for 6,620 of its narrowbodies, while its rival holds orders for 4,312 narrowbodies. The European manufacturer also plans to raise its production rate to nearly 70 aircraft, split between the A320 and A220 families. On the other hand, Boeing expects to cap 737 productions to 47 airplanes per month by the end of 2023. Both companies’ backlog stands at roughly eight years, so there does not appear to be any necessity for additional final assembly lines.
Supply Chain Challenges
The supply chain challenge adds another hurdle to the Indian government’s pursuit of a role in the aerospace sector.
Covid has put the entire aerospace supply chain under strain, and the industry has yet to recover to its pre-Covid level. While a new FAL takes 3-4 years to come online, suppliers will need help to reach higher production capacity.
Even though the southern Asian country is very involved in aerospace development, its involvement is mainly in design. It has yet to develop a significant presence in other aspects of aircraft manufacturing. The country will need to find a way to build its talent pool to land an FAL.
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