The Deal

Tata’s Air India has recently announced that it has ordered 470 planes from Boeing and Airbus. This deal has created history around the globe, and a new record has been set. Beating the old record of the American Airlines deal of 460 planes in 2011, Air India has created history. This deal has been a dramatic surprise for people all over the globe. Changing the previous image of India is a loud statement to the west that India is a growing market and economy. Soon, it will take the 3rd largest economic position in global markets. This deal might be just foretelling it. 

History Of Air India

J.R.D Tata created Air India in 1932, before the independence of India. Later in 1953, it was nationalized, and the government held 49% of its stake. In January 2022, the company was back in the hand of Tata Sons. The company made a successful bid of Rs.18 000 crores for the airline company last year.

According to the government, Air India decided to sell because the airline suffered losses of Rs.20 crore per day. The reasons given were the failure to compete with other low-cost airlines. With the vision and the funds, Tata decided to bid for it and bring the company back to its home.

Image Credit : Republic World

Impact Of This Deal On The Industry  

The domestic aviation market is happy because its growing demand can now be fulfilled. The Union Budget has already announced 50 more new airports, and this deal will make the connection across the nation easier. 

The number of airports in India has also increased in the past eight years from 74 to 147 to cope with the growing demand. As a result, after the pandemic, the Indian Aviation market has seen a huge spike. According to DGCA, in December 2022, the domestic air traffic rose to 127.35 lakhs air travelers.

Tata already owns Vistara and Air Asia. Currently, Air India is said to have 115 aircraft. Vistara has 54 and 32 in Air Asia. This deal post-merger will make Air India one of the largest airline companies in the world.

Indigo’s chief executive PeiterElbers has said they are not ignoring the deal. Still, with the growth of the Indian aviation market, it will be able to accommodate the influx of aircraft. 

Capturing The Global Market 

Aviation expert Mark Martin says with such a big order, Air India’s fleet will be at par with Singapore Airlines and Lufthansa. Though Tatas have not announced any plans to compete with other big airlines, it will undoubtedly be a part of their plan in the future with such a big fleet.

Indian air passengers still heavily rely on Qatar Airways, Emirates, and Etihad to travel overseas. This deal could change it and help capture the huge Asian and Middle East markets, making it a global player.

Image Credit : Republic World

What The World Has To Say

American president Joe Biden has hailed the Air India’s deal as a historic agreement. The purchase will create 1 million jobs in 44 states in America, according to the American president. Indian PM Modi and US President Biden discussed their satisfaction with the India- US partnership after the historic deal.

French President Emmanuel Macron thanked Narendra Modi for his confidence in France and the French Industry for the deal between Air India and Airbus. Air India has signed a deal for 250 Airbus planes, and according to the French president, this marks a new stage in India – France relationship. 

UK president Rishi Sunak also hailed the historic deal and said the sky is the limit for the aerospace sector.

The salt to software Tata conglomerate is a huge pride for India and its economy. As Ratan Tata once said, we are industrialists, not a businessman. The company has time and again shown its Excellency in creating industries.

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