(Image source from: x.com/airindia)
Air India Ltd is seeking to acquire Boeing Co aircraft that were turned down by Chinese airlines, according to sources familiar with the situation. This move places them alongside various Asian carriers eager to capitalize on the ongoing trade tensions between Washington and Beijing. The airline, owned by the Tata Group, is in urgent need of planes to accelerate its recovery and intends to reach out to Boeing regarding the purchase of several jets that the US manufacturer had prepared for Chinese companies before the imposition of mutual tariffs disrupted the deliveries. Sources, who prefer to remain unnamed due to the confidential nature of the discussions, noted that Air India is also interested in securing potential future delivery slots if they become available. In the past, the airline has gained from the retreat of Chinese carriers, having accepted 41 737 Max jets that were initially intended for them, following the deferral of deliveries that dated back to the grounding of the model in 2019.
Both Air India and Boeing representatives declined to provide comments on the matter. Additionally, Malaysia Aviation Group Bhd is reportedly in negotiations with Boeing regarding delivery slots that have been vacated by Chinese airlines, as reported by Bernama on Sunday. Bloomberg News revealed last week that the Chinese government instructed its airlines not to accept any Boeing aircraft after implementing reciprocal tariffs as high as 125% on goods made in the United States. At this juncture, around ten planes were on the verge of delivery, with some 737 Max jets in China having been returned to the US. The complexities involved for potential buyers arise from the cabin configurations that may have already been predetermined by the original clients, along with some payments already made. Boeing is restricted from transferring any aircraft to new owners that are still under contract with Chinese airlines.
The interest from airlines outside of China could alleviate some immediate challenges for Boeing, a leading US exporter, if the trade dispute persists. However, the ongoing conflict may hinder efforts to dismantle a so-called shadow factory for the stored 737s this summer. An update regarding the situation from the US manufacturer is anticipated in its upcoming quarterly results this week. The tensions between Washington and Beijing have provided an edge to Airbus SE over Boeing in the Chinese market in recent years. In the long term, geopolitical issues pose a risk of excluding Boeing from one of the largest aircraft markets globally. Following the grounding of the 737 Max, prompted by two tragic incidents and the challenges posed by the pandemic, Boeing accumulated a stockpile of hundreds of undelivered jets. Chinese regulators were among the last to grant clearance for the aircraft, and additional complications further delayed deliveries, prompting the US manufacturer to start remarketing these planes. Last year, Chinese authorities halted 737 deliveries for two months due to concerns regarding lithium batteries used in cockpit voice recorders.
Air India is looking to acquire additional already manufactured Max narrowbody aircraft for its Air India Express division, according to sources. The airline aims to develop this low-cost subsidiary as a competitive response to InterGlobe Aviation Ltd, which runs the leading airline in India, IndiGo. Reports from Bloomberg News indicate that Air India is expected to take possession of approximately nine more stored 737 planes by June, bringing its total to 50. While this supply was anticipated to be depleted in the coming months, the ongoing US-China trade tensions might extend Air India's access to these Boeing aircraft.
Typically, the planes undergo repainting in Bengaluru. Air India Express aims to transform the business class sections of the received planes into economy class by April 2026; however, progress has been hindered by supply chain challenges, according to sources. The remaining deliveries of 140 narrowbody aircraft from Air India’s 2023 order are not anticipated to commence until after March 2026. This delay could put the airline at a disadvantage against IndiGo if new Boeing planes are not available to it.
Air India's expansion is also likely to be affected due to a retrofit initiative that will temporarily take some jets out of service, as well as a plan to retire certain Airbus models. Last month, CEO Campbell Wilson mentioned that the airline is attempting to attract customers with lower fares in an effort to compensate for outdated cabin interiors and delays in upgrades.
