Airbus hails landmark multi-billion pound deal

Air India

Aircraft manufacturer Airbus has hailed a “landmark” multibillion-pound deal with Air India for 250 new aircraft, which will lead to around 450 new jobs and £100m of investment at the company.

The deal was announced in a virtual joint statement featuring Indian prime minister Narendra Modi, French president Emmanual Macron, and Ratan Tata, head of Indian conglomerate Tata which bought Air India from the Indian government last year.

Airbus is one of the biggest employees in the South West and more than 3,000 people are based at the firm’s plant in Filton. Research and design work is carried out at the South Gloucestershire factory on wings and landing gear.

Tata also owns the Jaguar Land Rover brand which employs around 4,000 staff at its Halewood plant in Knowsley.

Air India’s order is for 34 A350-1000 and six A350-900 wide-body aircraft, and 140 A320neo and 70 A321neo single-aisle aircraft.

Deliveries are set to commence with the first A350-900 arriving by late-2023.

Guillaume Faury, Airbus chief executive, said the A350 and A320 Neo (new engine option) planes had been chosen “to script Air India’s revival”.

He added: “The time is right for India to turn into an international hub,” describing the deal as “historic”.

Tata’s acquisition of the carrier marked a return to its original owner after it was nationalised in 1953. The conglomerate has promised to modernise the airline, which intends to purchase a further 220 aircraft from US manufacturer Boeing.

Tata Sons chair, Natarajan Chandrasekaran, was also involved in the virtual announcement and said: “A lot of emotions are involved in this project, there are huge expectations.”

Rishi Sunak welcomed the deal, while new Business and Trade Secretary, Kemi Badenoch said: “This is a significant win for the UK’s world-leading aerospace sector and one which will help to secure thousands of highly skilled jobs across the country and drive economic growth.

“It’s a shot in the arm for UK exports as we aim to sell £1 trillion of goods and services a year to the world by the end of the decade.”

Campbell Wilson, chief executive of  Air India, said: “Airbus has been a longstanding partner of Air India, and these new aircraft will play an important part in delivering Vihaan.AI, Air India’s comprehensive transformation and growth strategy.

“A core element of this transformation is the significant expansion of our network, both domestically and internationally, coupled with the elevation of our on-ground and onboard product to world-class standards. This order marks the start of a new chapter for both Airbus and Air India.”

Christian Scher, Airbus chief commercial officer and head of international, said: “This is a historic moment for Airbus and for Air India.

“India is on the verge of an international air travel revolution and we are honoured that our partnership with the Tatas and our aircraft solutions will write that new chapter for the country’s air-connectivity.”

He added: “We salute Air India for its visionary strategy, picking the two reference aircraft types in each of their categories. We are thrilled and humbled to see these aircraft become the cornerstones of Air India’s renaissance. This fleet will propel the airline globally where it deserves to be – with the best.

Over the next decade India will grow to have the largest population in the world, its economy will expand the fastest among the G20 nations, and a burgeoning middle class will spend more on air travel.

As a result, passenger traffic in India will grow fast, including on the long-range markets in the US, Europe and Asia Pacific that the A350 is well positioned to serve.