– In one of the biggest aircraft order by Indian carrier, Boeing has won a $ 22 bn deal from India’s fourth largest carrier Spicejet which has enlarged its existing order of 55 aircraft with additional 100 B737-8Max with an option for 50 more. SpiceJet placed its first order with Boeing in 2005 for Next-Generation B737s and currently operates 32 Next-Generation B737s in its fleet and 17 Bombardier Q400s. Deliveries of the aircraft will start in July 2018 and the entire order will be delivered to Spicejet by year 2024.
“We are now in a very good position to expand our network and operations which includes both domestic and international routes and destinations,” said Ajay Singh, Chairman and Managing Director, SpiceJet.
Boeing claims that the new airplane will consume 20 per cent less fuel than the first Next-Generation B737s and the lowest operating costs in its class – eight per cent per seat less than its nearest competitor.
The deal is major breakthrough for Boeing as currently Airbus dominates the Indian as well as other Asian markets. SpiceJet and AirIndia Express are the only budget carriers to use Boeing aircraft in India, while IndiGo, Go Airlines India Pvt. and the local unit of AirAsia Bhd. all fly Airbus jets.
Currently, Airbus and Boeing are facing slowing sales and highest level of delivery deferral due to decrease in profit margin of airline companies. It is estimated that India needs 1,850 new aircraft worth $ 265 Billion in next 20 years with small aircraft expected to dominate the market.
Aircraft manufacturers from Russia and Japan plan to enter $300 Billion Indian market which is mainly dominated by Airbus and Boeing. Russia wants to introduce Sukhoi Superjet 100 (SSJ100) civilian aircraft in India and has a target to put out at least 50 SSJ100 in the next three to five years. Japan’s ShinMaywa is also exploring the possibilities in Indian Market. In 2015, Airbus had seal a deal worth $ 27 bn with Indigo, India’s biggest budget carrier to deliver 250 aircraft preceded by a deal in 2006 for 100 A-320 planes and 180 A-320neos in 2011.
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