Beleaguered Indian national carrier Air India is in talks to cancel an order for six Boeing 777-300ERs that it was due to receive in the next two years.
"Air India is in a dialogue with Boeing on the cancellation of six Boeing 777s in view of the global aviation scenario," says an Air India spokesman. The carrier has asked the government, its owner, for a bail-out to cope with massive losses and rising debt.
It had been due to receive the six aircraft in the 2010-11 and 2011-12 fiscal years, says a spokesman. According to Flight's ACAS database, Air India has 10 777-300ERs and three Boeing 777-200LRs on order.
These were part of a 2006 order worth an estimated $8 billion for 23 777s, 27 787-8s and 18 737-800s. Indian Airlines, with which Air India merged last year, also ordered 48 new Airbus aircraft at the same time. Debt levels at the National Aviation Co of India (Nacil), Air India's parent company, reached 152.41 billion Indian rupees in June after paying for new aircraft.
Earlier in July, Air India said that it had received a $1.06 billion loan from JPMorgan Chase & Co to fund its of 10 Boeing passenger aircraft - three 777-200s, four 777-300s and three 737-800s - that it plans to take delivery in this financial year. A spokesman said that there are no plans to cancel the delivery of the aircraft that are due in the year to 31 March 2010.
He declined to comment on whether Air India would cancel any of its 787 orders.
Air India made a loss of around 50 billion Indian rupees for the year to 31 March, according to the country's civil aviation minister. It has been losing money for years and has asked the government for an equity infusion of 12.31 billion Indian rupees and a soft loan of 27.5 billion Indian rupees that will be repaid over 15 years.
The government, in turn, has asked it to come up with a cost-cutting and restructuring programme that will help it to return to profitability.
In June, Air India had an 18% share of the Indian domestic market with 6.5 million passengers. That put it behind Kingfisher Airlines (24.4%) and Jet Airways/JetLite (23.9%). Its load factor in June was 68%.
Source: Air Transport Intelligence news
