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Business Times
17-07-2025
- Business
- Business Times
Trump's trade deal pushes Garuda to learn to love 737 Max again
[JAKARTA] Five months after a Boeing 737 Max aircraft operated by Lion Air crashed into the Java Sea in 2018, Indonesian flag carrier Garuda Indonesia tried to cancel its remaining order for the same model. Now, the country is working to revive that deal as it seeks to forge favourable ties with US President Donald Trump's administration. Trump announced in a social media post on Tuesday (Jul 15) that Indonesia will order 50 aircraft, including 'many' of Boeing's larger 777 planes. While Trump did not disclose a buyer, Garuda chief executive officer Wamildan Tsani Panjaitan had previously said he's in talks to buy 50 to 75 Boeing aircraft, including 737 Max and 787-9 Dreamliner models. The accord points to the intertwined political and economic interests whenever Trump negotiates with foreign leaders. The US President has previously announced aircraft purchases while visiting countries including Qatar, or when he's hammered out trade agreements with the likes of Vietnam or the UK. In Indonesia's case, Trump said he got the deal over the line in direct negotiations with President Prabowo Subianto during a phone call. The dilemma for Boeing is how to restore or expand the existing 49-jet Max order without leaving Garuda in a financial and strategic bind. The airline is already having trouble keeping its existing fleet airworthy, with at least 15 jets grounded as recently as May, as it struggles to make maintenance payments. At the same time, the state-owned carrier, alongside the Danantara sovereign wealth fund that owns Garuda, is under pressure to move quickly with an announcement to please Trump, according to people familiar with the discussions. The airline and Boeing do not yet have an agreement on the models and quantities that would typically be in such an announcement, said the sources, who asked not to be identified discussing private matters. Boeing referred any questions to Garuda. The airline and its owner did not immediately respond to requests for comment. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up On its own, Garuda does not even have the funds to finance the earlier 737 Max agreement, the sources said. That may prompt Danantara to step in by providing some sort of guarantee or a shareholder loan similar to the US$405 million it put forward last month, the sources said. Garuda may receive between US$800 million and US$1.2 billion more from Danantara to assist with payments to maintenance and leasing companies, they added. As a result, any plane deal could be structured as a purchase while the parties discuss financing options with Danantara and lessors for a later stage, the sources said. But given the weighty political implications, Garuda may feel pressure to agree to a deal under terms it does not necessarily favour and with jets it does not actually need, one of the sources said. Trump is known to combine state visits with tariff announcements to flex his deal-making skills. During his tour of the Middle East, he announced an aircraft accord in every country he visited, including a record plane purchase by Qatar Airways. Not all of those transactions are necessarily what they appear to be. Trump has previously announced inaccurate sizes for accords, wrong numbers of purchased jets or has mixed up aircraft types. He's also presented old agreements as new ones. Some deals that were announced during his first term meanwhile, have since fallen through. At this point, Garuda only operates eight older 777-300 aircraft, raising the question of why the airline would want to buy Boeing's yet-to-be-certified successor in large quantities, as Trump has suggested. The earlier 737 Max order still sits on Boeing's books under a special US accounting category for at-risk deals that are not likely to materialise, the sources said. The state-owned carrier sank back into the red in 2024 after an almost US$10 billion debt restructuring failed to revive its fortunes. That performance is in contrast to its peers in the region that are profitable as they benefit from a rebound in travel demand after the pandemic. BLOOMBERG
Time of India
15-06-2025
- Business
- Time of India
Frankfurt-Hyderabad flight returns mid-air; passengers safe, ATC alerted
A Hyderabad-bound Lufthansa flight (LH752) from Frankfurt made a mid-air U-turn and returned to its base on Sunday, sources told PTI. The reason for the flight's return was not immediately disclosed. Tired of too many ads? go ad free now Air Traffic Control at Rajiv Gandhi International Airport in Hyderabad was informed that the Boeing 787-9 Dreamliner had turned back shortly after takeoff. The incident comes amid heightened scrutiny of Dreamliner aircraft. On Sunday, Air India Express reported a delay on its Kolkata–Hindon route due to a technical snag. 'Our Kolkata - Hindon flight operated, with a delay, due to a snag on the originally assigned aircraft. Guests were offered complimentary rescheduling or cancellation with a full refund. We regret the inconvenience,' an airline spokesperson said. Safety checks on Boeing 787s are currently underway following a DGCA directive, after the Ahemdabad crash that killed over 270.
BusinessToday
14-06-2025
- Business
- BusinessToday
Boeing Resumes Deliveries To China As US-China Trade Tensions Ease
Boeing has resumed aircraft deliveries to China, handing over a new 787-9 Dreamliner to Juneyao Airlines, according to a report by Chinese media outlet Yicai. The milestone marks a significant shift in US-China trade dynamics and reopens a critical market for the American aerospace giant. The delivery is Boeing's first to a Chinese carrier since April, when the company paused shipments amid rising tariffs linked to the ongoing trade conflict between Washington and Beijing. The breakthrough comes just days after US and Chinese officials concluded two days of negotiations in London, agreeing on a framework to reduce and stabilise tariff rates. At the end of May, Boeing confirmed it would resume deliveries in June, following a temporary 90-day easing of trade restrictions. China represents approximately 10% of Boeing's commercial aircraft backlog, making it a vital market for future growth. Earlier this week, a Boeing 737 MAX bearing the livery of Xiamen Airlines also landed in China, another clear signal that one of the world's most important aviation markets is once again opening up to the US planemaker. The resumed deliveries come amid renewed scrutiny of Boeing's aircraft following a deadly 787-8 crash in India just two days before the Juneyao delivery. Neither Boeing nor Juneyao Airlines has issued a public statement regarding the delivery report. The development may offer much-needed momentum for Boeing, which had previously considered reselling dozens of aircraft intended for Chinese customers due to trade barriers. With negotiations progressing and tariffs easing, the company is now better positioned to recapture lost ground in Asia's fast-growing aviation sector. Related
Mint
21-05-2025
- Business
- Mint
Mahakumbh propels IndiGo to best-ever profits, sets a new course on international
IndiGo, India's largest airline by fleet and market share, reported splendid results with best-ever Q4-FY25 at INR 3067.5 crore, and just short of its all-time best of INR 3089 crore reported in Q1-FY24. The airline ended the year with a profit of INR 7254.8 crore. As the airline turned 18 last year, it announced the launch of a new class of service named IndiGoStretch, its business class product. As it quickly scaled its dual-class fleet adding route after route, with an aim to have 45 aircraft in its fleet by end of this year, the airline shied away from offering hot meals, instead offering vegetarian only set meal boxes. With the launch of flights to Amsterdam and Manchester, this is set to change and possibly give a sneak peek into what its own A350s would look like, when they join the fleet in 2027. As IndiGoStretch took to the air, the preset Vegetarian box meals crafted by Oberoi Flight Kitchen were offered on a complimentary basis. With flights to Amsterdam and Manchester, the airline will be offering complimentary hot meals to all passengers on this flight. While complimentary meals have been around for a while, the Hot meals part makes a huge change since the airline kept out ovens for all these years, citing the high weight of ovens. The flights to Amsterdam and Manchester are operated by the 787-9 Dreamliner aircraft which come from Norse Atlantic which has ovens in their aircraft thus enabling hot meals. In the Premium Economy cabin of Norse Atlantic, sold as IndiGoStretch, IndiGo will offer complimentary hot meals and alcoholic beverages while the economy class will see hot meals and non-alcoholic beverages being complimentary. The airline will offer alcohol for purchase in the economy class. However, all meals are vegetarian by default and a passenger will have to select 'Non vegetarian' preflight if the passenger so desires. With six aircraft lined up for induction by the first quarter of calendar year 2026, the airline is aligning itself to what its final service levels will be when the A350s land in India in IndiGo colors. The A321XLRs which are expected to join before the end of this fiscal, will also have dual class operations One of the differentiators for Air India over IndiGo in the front cabin was lounge access, with Air India having their own lounge at Delhi. IndiGo has now added lounge access to their IndiGoStretch offering, but kept it restricted to intercontinental flights to Amsterdam and Manchester. The domestic flights and flights to Bangkok do not reflect the lounge access right now. The lounge would also be available to passengers boarding at Amsterdam and Manchester. Lounge is a costly affair for any airline. Rival on the route but codeshare partner KLM offers flat bed Business class on the route unlike IndiGo, which will best match the Premium Economy class of KLM. In terms of pricing, this will be tricky since the passengers will be eligible for a lounge with a product which is not lie flat business and at a cost which is much more reasonable than KLM. IndiGo is offering a 30 kg baggage allowance in economy class, compared to 23 kgs offered by Air India. However, the routes of IndiGo are exclusive to Air India. KLM, which also operates to Amsterdam from Mumbai, offers 23 kg allowance in Economy. IndiGo has a monopoly to Manchester, from any point in India. IndiGo's Aircraft on Ground (AOG) situation has improved significantly with nearly half of the aircraft being back in service or redelivered from its peak. The focus is now international, with or without their own planes. It is an irony or sorts that an all Airbus airline is relying on Boeing widebodies for the international foray. The Delhi - Bangkok sector is reverting back to narrowbody, which means as more aircraft join later in the year from Norse Atlantic, there are more and more destinations lined up from Mumbai. A lot will also depend on the geopolitical situation and the ability of other airports to swing the flight in their favor.
Mint
21-05-2025
- Business
- Mint
IndiGo announces its longest flight yet, to offer complimentary meals and beverages
IndiGo, the largest airline in India, has opened for sale its flights to Manchester and Amsterdam. The airline has been on a different trajectory on the other side of the pandemic, leaving the low-cost carrier mode long back. With a dual class on offer and a widebody order in place, and the intermediate induction of 787-9 Dreamliner from Norse Atlantic on lease, IndiGo is leap-frogging on the international side to take on Air India. IndiGo has been selling tickets to both Manchester and Amsterdam from Delhi via Istanbul on its codeshare partner Turkish Airlines. Manchester is one of the top unserved routes out of India, while Amsterdam has competition from KLM as well as Air India, both operating daily from Delhi, while KLM also operates from Mumbai and Bengaluru. The airline has been flying the B777s in its fleet for a while now; however, they do not operate to their full range potential and have replaced a route which was being flown by the A321neo/A320neo. With the Norse Atlantic Dreamliners, IndiGo is now venturing into routes which will test its operations even more as the routes are beyond the flying envelope of its backbone A320 family fleet. While the airline had announced flights from Delhi, the subsequent closure of Pakistani airspace and not having clarity on when it would reopen has meant that the airline has shifted its flights to originate at Mumbai instead of Delhi, an unlikely gain for Mumbai airport. One of the most important announcements that come with this is the change in service standards for the airline. IndiGo says that it will offer complimentary hot meals and beverages will be served to all customers on this route. The airline has not been serving hot meals to even its IndiGoStretch customers, which is its competition to Business class product in Indian skies. The hot meals have been possible since these two routes will see the Norse Atlantic-owned 787-9 Dreamliner aircraft, which are fitted with ovens and are configured with 56 Premium Economy seats, which IndiGo sells as IndiGoStretch and 282 Economy class seats. The airline will be serving meals and alcohol on a complimentary basis to IndiGoStretch customers, while only meals and non-alcoholic beverages will be served to Economy class, with alcoholic beverages available for purchase. IndiGo has partnerships with Turkish Airlines, Qatar Airways, Air France-KLM, American Airlines, Qantas and Virgin Atlantic. These partners have been looking at Indian traffic to fill their intercontinental flights from their respective hubs in addition to Origin-Destination traffic. All in all, flights to one or more of these hubs could pave the way for collaboration between IndiGo and these airlines. All Indian carriers have always had ambitions to fly to London; while initially it was expected that the A321XLR could achieve that ambition for IndiGo, it became clear that it wouldn't be possible with the XLR. If collaboration is on the cards, the next destinations for IndiGo could well be Paris (where Air France has a hub), in addition to London—which will be heavily dependent on the availability of slots. Can the airline snatch a bargain with the partner airlines to lease slots? This would be a game changer like no other. The Indian traffic is lucrative for all carriers because of the sheer volumes it provides, and a partnership where IndiGo helps add anywhere between 200 and 300 more passengers per day is definitely a win for the partner airlines, in return for a slot which also comes at commercial terms. IndiGo has a robust cost structure and a balance sheet which allows it to experiment and hold on to its plan for a little longer than what it would have otherwise been for the competition. Air India is into its fourth year of privatisation and has faced headwinds with slots for revamp of its legacy fleet. The airline has not been able to add many destinations, especially with the long-haul fleet. On routes which have bilateral or slot constraints, getting equal with Air India or ahead of Air India makes sense for the airline instead of waiting until late 2027 or early 2028 when it can deploy its own A350s. As Air India pushes Air India Express to lock horns with IndiGo on domestic routes, IndiGo is beginning to lock horns with Air India on international routes. Does it help negotiate better with Adani Airports to manage its slot portfolio at Mumbai? Time will tell.
