Pilot Career Centre - Global
Pilot Career Centre - Global

SpiceJet in Talks with Boeing, Airbus for US$11 Billion Aircraft Deal

SpiceJet in Talks with Boeing, Airbus for US$11 Billion Aircraft Deal

2015 07 29

2015 07 29

By Anurag Kotoky, Bloomberg News

SpiceJet Ltd. is in talks with Boeing Co. and Airbus Group to buy more than 100 single-aisle jets worth about US$11 billion at list prices, in what would be the Indian budget carrier's largest-ever plane order. The stock rose.

The discussions are for Airbus A320neo and Boeing 737 Max aircraft, SpiceJet Chairman Ajay Singh said in an interview Tuesday at Gurgaon, near New Delhi. A deal could be signed during the current financial year, which ends March 31.

Carriers in India and China have ordered hundreds of new aircraft in the past decade as an economic boom encourages people in the world's two-most populous nations to travel more. India needs 1,600 new planes valued at US$205 billion in the next two decades, Boeing forecast last year.

SpiceJet shares rose as much as 5.6 percent Wednesday to 28.10 rupees, their highest intraday level in two years.

SpiceJet currently flies 18 Boeing 737 jets and has two Airbus planes on wet-lease, but a purchase from Airbus would be its first from the French planemaker. IndiGo, the country's biggest carrier, and the Indian units of Singapore Airlines Ltd. and AirAsia Bhd. fly only Airbus jets.

"We will bring in some investments at the time of the order," Singh said, "The order will depend on what volume level we get at what price," but it will be for more than 100 planes, he said.

Financial Trouble

Any new investment in SpiceJet probably would take the form of new shares or debt, Chief Financial Officer Kiran Koteshwar said in a separate interview Tuesday.

Talks don't mean a deal ultimately will be concluded. IndiGo signed an initial agreement with Airbus in October 2014 for 250 A320neo planes, in what would have been Airbus's largest order by number of aircraft. Since then, the terms expired before a final deal was signed. The companies remain in talks, according to IndiGo.

SpiceJet, which ran into financial trouble last year and was on the verge of shutting down, was rescued by co-founder and current chairman Singh. Since then, the carrier has posted two consecutive quarters of profit.

The airline said Tuesday it posted 718.5 million rupees (US$11 million) in net income in the quarter through June, compared to a 1.24 billion rupee loss a year earlier.

In March last year, the the carrier made an order for 42 737 Max planes valued at US$4.4 billion. The Max is an upgraded version of the single-aisle 737, the world's most widely flown jetliner, and features new, more-efficient engines.

The A320neo is also an upgraded version of Airbus's best-selling plane.


Boeing & MD OperatorsBoeing & MD Operators

Airbus OperatorsAirbus Operators

PCC Asia
Quick Search
Search in progress
Pilot Jobs
Air Carriers
Flight Schools
Aviation News