Air India manages to get a $221 million discount from Boeing

Air India manages to get a $221 million discount from Boeing

India’s largest overseas airline carrier finally received the government approval to purchase 68 aircrafts from the US based aircraft manufacturer Boeing. And they have managed to get a fairly impressive discount from the company. Boeing and Airbus both are in serious competition in the aviation industry and this helps the airline companies to get the best value for their money while acquiring new planes.

Aviation Minister Praful Patel said in a statement that Air India got a discount of 10 billion rupees ($221 million) for the 68 aircraft they are purchasing from Boeing. The deal was approved by the Indian cabinet a few days ago and was subject to a final round of price negotiations. The order is expected to be worth around USD 8 billion.

The purchase plan would now require approval from the Prime Minister of India and after the formalities are completed, Boeing would be delivering these planes beginning November 2006. The deliveries of these planes would continue till the year 2011. Air India requires to improve their fleet to carry passengers overseas considering many new players have entered into this market, which has grown phenomenally in the last couple of years.

Now, we have giants like Deutsche Lufthansa AG, Singapore Airlines Ltd., and AMR Corp.’s American Airlines Inc. along with Air France expanding their presence here in India and Air India requires the resources to compete efficiently.

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