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Wed 22 Jan 2014 10:54 AM

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Etihad-backed Jet Airways touted for 50 new Boeing planes

The $2.5bn deal will help India's second largest carrier expand its network

Etihad-backed Jet Airways touted for 50 new Boeing planes

Etihad-backed Jet Airways is reportedly set to order 50 Boeing aircraft worth $2.5bn, unnamed sources told Bloomberg.

The airline, the second-largest by market share in the sub-continent, may order 737 single-aisle planes to use for its local expansion, Bloomberg TV India said.

Buying new planes will enable Mumbai-based Jet Airways to expand and start more routes ahead of impending competition with Singapore Airlines and Air Asia, which have both sought to start local airlines.

Last year, Boeing estimated Indian operators will need 1,450 new planes in the next 20 years, of which 1,201 will be single-aisle planes.

Martin Consulting has forecast Indian carriers will need at least 200 planes just for local operations in the next 12 months, Bloomberg reported.

Abu Dhabi’s Etihad Airways bought a 24 percent stake in Jet last year, in the first cross-border deal for Indian carriers since rules were eased in 2012.

Etihad is expanding its business in India rivaling Dubai’s Emirates Airline, which traditionally has had a stronghold in the South Asian country.

Air India, Spice Jet and Jet Airways are potential candidates for the 737 Max aircraft, Boeing’s Asia-Pacific vice president Dinesh Keskar said in New Delhi in October.

“India’s airlines have not really kept up with the growth in the market,” Mark Martin, chief executive of Dubai-based Martin Consulting, told Bloomberg. “Demand for air travel has gone up, but there is no fleet to cater to that demand.”

Demand from India and China and global growth of low-fare carriers will spur a market for $4.4 trillion worth of commercial planes in the next two decades, according to Airbus.

The number of air passengers in India is forecast to triple to 452 million by 2020, according to a report by CAPA Centre for Aviation and SITA.

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