Air India Keen To Take Boeing Jets Refused By China Airlines: Report
Air India Ltd is looking to take Boeing Co planes rejected by Chinese carriers, people familiar with the matter said, joining the ranks of Asian airlines vying to benefit from the trade war between Washington and Beijing.
The Tata Group-owned carrier, which urgently needs aircraft to expedite its revival, plans to approach Boeing about acquiring a number of jets the US planemaker was readying for Chinese airlines before reciprocal tariffs thwarted the handovers, according to the people, who are familiar with discussions at the Indian airline and didn't want to be identified because the information isn't public.
Air India is also eager to take up slots for future deliveries should they become available, the people said. The carrier has benefited from China's pullback in the past - through March, it had accepted 41 737 Max jets originally built for Chinese airlines whose deliveries were deferred dating back to the model's 2019 grounding.
Representatives for Air India and Boeing declined to comment. Malaysia Aviation Group Bhd too is in talks with Boeing over delivery slots vacated by Chinese carriers, Bernama reported on Sunday.
Chinese airlines were told by the government not to accept Boeing aircraft, Bloomberg News reported last week, after Beijing set reciprocal tariffs of up to 125% on US-made goods. About 10 planes were being prepared for delivery at the time, and some 737 Max jets in China have since been sent back to the US.
Any Boeing planes already built or in progress will present complications for potential buyers, as the cabin configurations for many will already have been set by the original customer, and some payments will have been made. Boeing can't place any aircraft with new owners that are still under contract to airlines in China.
The interest from non-Chinese airlines is likely to soften the short-term blow for Boeing, one of the highest-profile US exporters, should the tariff war continue. Still, the trade conflict may complicate efforts to wind down a so-called shadow factory for stored 737s this summer. The US manufacturer is expected to provide an update on the situation with its quarterly results this week.
Friction between Washington and Beijing has given Europe's Airbus SE the advantage over Boeing in China over the past several years. In the longer term, geopolitics threatens to shut Boeing out of one of the world's biggest aircraft markets.
Boeing built up an inventory of hundreds of undelivered 737 Max jets starting with its grounding, spurred by two deadly accidents, and continuing through the pandemic. Regulators in Beijing were among the last to clear the jet, and other issues also slowed deliveries, leading the US planemaker to eventually start remarketing the planes. Last year, Chinese regulators paused 737 deliveries for two months over concerns with lithium batteries in cockpit voice recorders.
Air India is interested in more of the already-made Max narrowbodies for its Air India Express unit, the people said. The airline is trying to build the low-cost subsidiary as part of its challenge to InterGlobe Aviation Ltd, which operates India's dominant carrier, IndiGo.
Air India was set to receive about nine more stored 737s through June, taking the total tally to 50 planes, Bloomberg News reported earlier this month. The pool was expected to run dry in a couple of months but with the US-China tariff war recasting the landscape, Air India's Boeing windfall could continue.
The planes are typically repainted in Bengaluru. Air India Express intends to replace business class on the ones it receives with economy by April 2026, but progress has been slowed by supply chain issues, the people said.
The remaining 140 narrowbody deliveries from Air India's 2023 order aren't expected to start until after March 2026, putting the airline at risk of falling further behind IndiGo if it can't secure any newly freed-up Boeing planes.
Air India's growth is also set to slow because of a retrofit program that will temporarily remove some jets from its fleet, and a plan to phase out some Airbus models. Chief Executive Officer Campbell Wilson said last month that the company is trying to woo customers with cheaper fares as it seeks to make up for dated cabins and upgrade delays.
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