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Air India Exploring Lease of Airbus A-320 Neos and Boeing 737 Max

Air India

Air India

Aiming at taking growing competition head-on, Air India is evaluating leasing fuel- efficient airplanes like Airbus A-320 neos for itself and Boeing 737 Max for its subsidiary Air India Express over the next three to six years.

While the national carrier would be getting its 18th Boeing 787 Dreamliners in December, it has already started exploring options to lease A-320 neos (New Engine Option) aircraft into its fleet after 2017.
Airline officials said they were looking at leasing the neos by 2017 onwards.
Earlier this month, no-frill carrier IndiGo placed the largest order for 250 of these neo planes which the European aircraft manufacturer Airbus claims to be fuel-efficient estimating that it can save fuel up to 15 per cent. The A-320 neos have a seat capacity of 238.

The officials said Air India was also considering leasing Boeing 737 Max, the new generation fuel-saving aircraft, for its subsidiary Air India Express.
The airline plans to lease them by 2020, though the first of these aircraft is scheduled for delivery in 2017.

On its financial parameters, the Air India officials said these have shown improvement in the first six months of this financial year with the airline’s network revenue recording an 11 per cent growth.
The national carrier registered an 11 per cent growth in network revenue at Rs 8,114 crore between April and September, up from Rs 7,289 crore reported during the same period last year.
The airline was able to achieve this despite the period being a lean season when most airlines report a decline in the number of passengers carried, the officials said.
The passenger load factor at 73.5 per cent on domestic and 74.8 per cent on international sectors exceeded the target of 73 and 74 per cent respectively, thus increasing the yields at a time of stiff competition posed by the no-frill carriers and their low fare offers, they said.

During April-September, 89 per cent of Air India’s domestic flights met their variable costs as compared to the same period previously. This meant that these flights were able to meet their fuel costs and handling and navigational charges, the officials said.


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