June 14: India was the star of the Paris air show today, accounting for over half of the $13 billion of jet deals carved up between America’s Boeing and European arch-rival Airbus.
The two companies announced having struck orders worth nearly $7 billion (Rs 30,000 crore) with India’s airlines. Jet Airways was a big buyer, placing orders for 10 Boeing 777s and 10 single-aisle 737-800s at a list price of $2.8 billion. It separately announced purchase of 10 Airbus aircraft with options to buy 10 more in a deal worth about $1.5 billion.
Rival Kingfisher Airlines said it planned to spend about $2.5 billion for “multiple wide-bodied aircraft” from Airbus, including its mammoth 555-seat A380 model, the world’s biggest airliner.
“India is today one of the world’s most promising markets,” Reuters quoted John Leahy, the chief commercial officer at Airbus, as saying at the air show.
Together, some seven Indian airlines have committed to buy about 220 aircraft of various shapes and sizes worth a mind-boggling $18 billion or Rs 72,000 crore.
Jet chairman Naresh Goyal told reporters the carrier’s order for 10 Boeing 777s and 10 single-aisle 737-800s was “just the beginning”. He said it was “looking very seriously” at Boeing’s newest plane, the 787 Dreamliner.
The airline plans to use the 777s ' to be delivered from late next year ' to start flying from New Delhi to New York’s John F. Kennedy international airport, he said.
But the boom is in domestic aviation. Analysts estimate that over the next five years, passenger traffic is set to grow 20 per cent a year.
Capt. G.R. Gopinath, founder of the start-up Air Deccan, which calls itself India’s first low-cost carrier, said: “We are focused on the domestic market. It’s growing at a phenomenal rate.”
Deccan wants to buy 30 Airbus and 30 ATRs (small planes) just to service the cheap travel segment.
Le Bourget, the venue of the Paris air show, will be abuzz with Indian activity tomorrow too when Vijay Mallya’s Kingfisher Airlines will place an order for five A380s as part of a 20-plane deal with Airbus.
Mallya is booking the A380 as Kingfisher looks ahead to flying on international routes. Asked if the A380 was just one of his fads, the flamboyant Mallya, who will be present in Paris when the order is placed, said he was driven by sound business sense.
Under India’s aviation policy, a local airline has to fly at least five years in the domestic skies before winging abroad. Kingfisher started operations recently.
“You know very well that A380s will be available only by 2009. So our aircraft delivery will match government policy,” Mallya said.
“China and India could be the drivers of growth in the future,” said Airbus chief executive Noel Forgeard.
India’s present average annual air travel is just 0.1 trips per person, a fraction of the global average of 2. The Chinese took only 0.13 flights per person in 2003.
Former Indian Airlines director Robin Pathak had a word of caution: “Boom time could also translate into bust time as aviation and tourism markets are extremely sensitive to events like war, terror attacks, health alerts and bad news of any kind.”