Air India Gets First Dreamliner After Four-Year Delay

Air India Ltd. took delivery of its first Boeing Co. (BA) 787 Dreamliner after almost four years of delays, which prompted the carrier to seek compensation.

The Dreamliner will fly to New Delhi today after taking off from Charleston, South Carolina, the planemaker said in an e- mailed statement yesterday.

Air India plans to use the fuel-efficient jets to start Sydney and Melbourne flights as it seeks to attract more passengers and cut expenses in a bid to end five years of losses. The carrier, which has 27 of the jets on order, received government permission on Aug. 3 to pay for its first few 787s after Chicago-based Boeing agreed to compensation.

Air India ordered the 787 in 2005 and was due to start receiving the planes in September 2008. Boeing struggled with new materials and manufacturing processes for the world’s first jetliner made from composite materials.

Air India’s delivery was further hampered by compensation talks, the government’s approval process and a two-month strike by pilots over the right to fly the new plane.

All Nippon Airways Co. (9202), Japan Airlines Co. and Ethiopian Airlines are among carriers that fly the 787. Qantas Airways Ltd. (QAN) canceled an order for 35 of the jets last month. Boeing has a backlog for more than 800 Dreamliners.

The 787 was more than three years behind schedule when it entered service in late 2011. India’s government didn’t give a figure last month when it approved the compensation agreement between Boeing and the airline.

Air India had demanded $840 million for the delays. The planemaker has declined to give any financial specifics.

Air India’s first two Dreamliners are being funded by a $195 million loan from Standard Chartered Plc. (STAN)

To contact the reporters on this story: Siddharth Philip in Mumbai at sphilip3@bloomberg.net; Malavika Sharma in New Delhi at msharma52@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net

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