Air India announced a record-breaking order for 470 planes from Airbus and Boeing on Tuesday, accelerating the rebirth of a national symbol under new owners Tata Group as Europe and the United States praised deepening economic and political ties with New Delhi.

The preliminary agreements include 220 Boeing planes and 250 Airbus planes, breaking previous records for a single airline as Air India competes with domestic giant IndiGo to serve what will soon be the world’s largest population.

The agreement was described as “historic” by US President Joe Biden, who discussed it by phone with Indian Prime Minister Narendra Modi, as part of a flurry of high-level reactions as the scale of India’s needs provided a rare bonanza for both competing plane giants in an industry where the winner typically takes all.

The Airbus order includes 210 A320neo narrowbody planes and 40 A350 widebody planes, which will be used by Air India to fly “ultra-long routes,” according to Tata Chairman N Chandrasekaran.

Boeing will supply 190 737 MAX aircraft, 20 787 Dreamliners, and ten 777X mini-jumbos.

According to an Airbus executive, the total acquisition includes another 25 Airbus jets that will be leased.

Reuters exclusively reported in December that Air India was on the verge of exceeding 500 jet orders.

Boeing shares increased 1.3%, while Airbus shares increased 0.3%.

The airline’s revival under the Tata conglomerate aims to capitalize on India’s growing flier base and large diaspora around the world.

Campbell Wilson, the airline’s new CEO, is working to restore its reputation as a world-class airline and dispel its image as a tardy, run-down operation with an aging fleet and poor service.

The importance of a deal involving the national airline was emphasized by Indian and French leaders.

“This important deal shows, along with the deepening of relations between India and France, the successes and aspirations of the civil aviation sector in India,” Modi said during a video ceremony with French President Emmanuel Macron.

“This achievement shows that Airbus and all its French partners are fully dedicated to develop new areas of dedication with India,” Macron said.

With Macron promising cooperation in other industries, it is anticipated that the aviation agreement will have industrial spillovers.

According to Chandrasekaran, Airbus and Tata are collaborating on larger projects with the goal of “bringing in commercial aircraft manufacturing at some point in the future.”

According to industry sources, Airbus has so far rejected the idea on commercial and financial grounds despite repeated requests from India to add a final assembly line in the country to match a plant in northern China.

The combined order for 460 Airbus and Boeing aircraft made by American Airlines more than ten years ago is surpassed by Air India’s order.

25 brand-new Boeing 737 MAX aircraft and six brand-new Airbus A350 aircraft will be the first to arrive in the second half of 2023, with deliveries really picking up in 2025 and beyond.

The deal, which is worth tens of billions of dollars even after significant anticipated discounts, comes at a precarious time for plane giants whose jets are once again in demand following the pandemic but who also have to contend with growing industrial and environmental pressures.

“It is important for the industry because given the recent turbulence in the China market, the alternative growth market is India,” said independent aviation adviser Bertrand Grabowski.

“India is also sending a strong political signal that it wants to remain attached to the West at a time when it has appeared ambiguous on Russian sanctions,” said Grabowski, a former banker with extensive experience of international deals.

Engine manufacturer CFM International, a joint venture between General Electric and France’s Safran, receives a significant win as a result of the agreement. 210 Airbus narrowbody aircraft will be powered by it instead of rival Pratt & Whitney, while larger aircraft will be powered by GE or Britain’s Rolls-Royce.

The deal, according to British Prime Minister Rishi Sunak, will generate new employment.

“Besides this deal being of unprecedented size, it was also incredibly complex,” Wilson said in a note to employees.

Air India, with its maharajah mascot, was once renowned for its opulently decorated aircraft and first-rate service, but as its financial problems grew in the mid-2000s, so did the airline’s goodwill.

The record order aims to elevate Air India to the level of major international carriers and establish it as a significant client for suppliers and planemakers at a time when its domestic market is experiencing a significant post-COVID-19 travel surge.

It reflects a plan to reclaim a sizeable portion of travel between the Indian diaspora and major cities like New Delhi and Mumbai, which are currently dominated by foreign competitors like Emirates.

Additionally, it will give Air India a better chance to compete with IndiGo, a domestic rival that controls the majority of the Indian market and dominates regional flights.

(Adapted from ThePrint.in)