Airbus Group NV (AIR) said it’ll keep an 82-plane order from defunct Kingfisher Airlines Ltd. (KAIR) on its books while there’s still a chance that the Indian carrier might find a buyer which would require new aircraft.
The order concerns 67 A320 narrow-body jetliners and 15 twin-aisle A330s with a list price of $6.8 billion.
“If Kingfisher finds a new buyer for the airline that buyer would need single-aisle planes, so for that reason we’ll keep them until the airline is completely shut down,” Kiran Rao, Airbus’s executive vice president of sales and marketing, said in a briefing at the company’s base in Toulouse, France.
Kingfisher had debt of 91.4 billion rupees ($1.5 billion) as of Dec. 31, according to data compiled by Bloomberg. Owned by liquor baron Vijay Mallya, the Bangalore-based carrier ceased operations in 2012 and lost its flying permit after defaulting on payments to lenders, staff, airports and lessors.
Airbus, which suffered its biggest-ever order loss this week when Dubai-based Emirates scrapped a $16 billion deal, has already struck Kingfisher’s deal for five A380 superjumbos and the same number of A350-800 long-haul planes from its books.
Indian rules would require any successor airline to amass five years of domestic operations with at least 20 planes before commencing flights abroad, making the order redundant.
Kingfisher said in January it aimed to restart operations, though its license will expire at the end of this year if flights don’t begin by then.
Indian carriers have lost $10 billion in seven years as high fuel prices and airport charges erase earnings, according to the CAPA Center for Aviation. Malaysia-based AirAsia Bhd (AIRA), Asia’s top budget carrier, began flying in India yesterday, pressuring carriers to cut fares to keep market share.
India lifted a ban on A380s flying into the country in January, a move that could see the country become the No. 1 destination for the double-decker outside the hubs where it is based, according to Rao, with seven or eight aircraft likely to be flying there by the year’s end.
Singapore Airlines Ltd. (SIA) made the first commercial A380 flight to India this month, and Emirates and Deutsche Lufthansa AG (LHA) are among other carriers planning to deploy the plane to the world’s second-most populous nation.