Jet Air May Buy 50 Boeing Planes for $2.5 Billion, BTVI Says
Jet Airways (India) Ltd. (JETIN), the nation’s second-largest airline by market share, may place an order for 50 Boeing Co. (BA) aircraft worth $2.5 billion, Bloomberg TV India reported, citing people it didn’t identify.
Jet, India’s biggest publicly traded carrier, may order 737 single-aisle planes, which will be used for local expansion, Bloomberg TV said in its report.
Buying new planes will enable Mumbai-based Jet Airways to expand and start more routes ahead of impending competition with Singapore Airlines Ltd. (SIA) and AirAsia Bhd. (AIRA), which have both sought to start local airlines. Indian carriers are buying aircraft from Airbus and Boeing as economic growth in the world’s second-most populous nation stokes travel demand.
“India’s airlines have not really kept up with the growth in the market,” said Mark D. Martin, chief executive officer of Dubai-based Martin Consulting LLC. “Demand for air travel has gone up, but there is no fleet to cater to that demand.”
Jet Airways shares gained 2.3 percent to 271.5 rupees as of 12:25 p.m. in Mumbai. Jet Airways didn’t respond to an e-mail seeking comment. Boeing spokeswoman Ashmita Sethi said the query should be addressed to the airline.
Demand from India and China and global growth of low-fare carriers will spur a market for $4.4 trillion worth of commercial planes in the next two decades, according to Airbus. The number of air passengers in India is forecast to triple to 452 million by 2020, according to a report by CAPA Centre for Aviation and SITA.
Last year, Boeing estimated Indian operators will need 1,450 new planes in the next 20 years. Of this, 1,201 will be single-aisle planes, according to the Chicago-based planemaker. Martin Consulting has forecast Indian carriers will need at least 200 planes just for local operations in the next 12 months.
Abu Dhabi’s Etihad Airways PJSC bought a 24 percent stake in Jet last year, in the first cross-border deal for Indian carriers since rules were eased in 2012. Etihad is expanding its business in India rivaling Dubai’s Emirates Airline, which traditionally has had a stronghold in the South Asian country.
Air India, SpiceJet Ltd. and Jet Airways are potential candidates for the 737 Max aircraft, Boeing’s Asia-Pacific vice president Dinesh Keskar said in New Delhi in October.
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