Indian Startup Airline Interested In Up To 100 Boeing 737 MAXs

Indian Startup Airline Interested In Up To 100 Boeing 737 MAXs

Akasa Air, India’s newest startup airline, has expressed interest in acquiring up to 100 Boeing 737 MAX aircraft. Akasa, which is backed by philanthropist Rakesh Jhunjhunwala, is in talks with Boeing to get the MAX for its new narrowbody fleet. In addition, the airline is in talks with officials in India to recertify the 737 MAX, which is now grounded. Let’s learn more about this opportunity and why it will benefit both Akasa and Boeing.

Only big bets

According to Moneycontrol, Akasa Air is in talks with Boeing about placing an order for up to 100 737 MAX planes. While we know the carrier is aiming to buy a 180-seater plane for its ultra-low-cost operations, the company’s decision to fly the 737 MAX is a significant one.

Akasa Air, which is funded by famed businessman Rakesh Jhunjhunwala, has recently made headlines. Industry veterans Aditya Ghosh (former CEO of IndiGo) and Vinay Dube will lead the airline (former CEO of Jet Airways and GoAir). Many people are excited about the company’s prospects in India’s crowded and usually low-yield market because of its celebrity.

Indian Startup Airline Interested In Up To 100 Boeing 737 MAXs

Airbus dominates the narrowbody market in India, with only one major airline using the 737. Photo: Getty Images

Akasa is attempting to enter into India’s saturated low-cost airline market. IndiGo is by far the industry leader, with a market share of over 50%, while SpiceJet, GoAir, and Air India make up the rest of the field (the full-service flag carrier). To succeed as another ultra-low-cost carrier, it will need to have a truly low-cost base. And the MAX could be the ideal aircraft for the job.

Struggling

Boeing has been struggling in the fast developing Indian market since 2019. When Jet Airways went bankrupt in 2019, the manufacturer lost hundreds of 737s and billions of dollars in orders. SpiceJet and Jet have already stopped taking new 737 MAX aircraft due to the grounding, substantially lowering Boeing’s fleet share.

Airbus, on the other hand, has been on a roll in India. IndiGo, GoAir, Vistara, AirAsia India, and Air India are all customers of the European behemoth. While Boeing’s clients are struggling financially, Airbus’ India deliveries and order book have only grown in the last five years. Boeing needs to make a major mark in India if it is to thrive.

Indian Startup Airline Interested In Up To 100 Boeing 737 MAXs

SpiceJet has indicated that it has no plans to recertify the 737 MAX in the near future, and the carrier is currently losing planes. Photo: Getty Images

A fresh Akasa order could be the jolt Boeing needs to reclaim its grip in India. One person close to the airline said, “The discussion is already having results.”

“In its meeting with authorities, the firm [Akasa] stated that it has made great progress in discussions with Boeing to acquire the 737 MAX and plans to begin operations in early 2022. The government must recertify the aircraft for this purpose.”

Furthermore, Akasa would negotiate much reduced costs for the 737 MAX, which has been grounded in India for almost two years. This will be a win-win situation for both Boeing and the new firm, allowing them to expand their footprint in India. While Airbus is the safer option, Akasa may be aiming to disrupt the current quo in order to make its mark.

Source Link

Cover Photo Credit: Boeing