India’s SpiceJet to buy Boeing planes worth $22bn

January 13, 2017
SpiceJet agrees to buy up to 205 Boeing planes worth $22 billion in what is said to be one the largest aviation deals in India/AFP

, NEW DELHI, India, Jan 13 – Indian airline SpiceJet said on Friday it had agreed to buy up to 205 Boeing planes worth $22 billion in what it said was one of the largest deals ever in Indian aviation.

SpiceJet Chairman Ajay Singh said the low-cost airline, which has a 13-percent share of the Indian market, was expanding both its domestic and international operations.

“This is the largest deal for SpiceJet, it’s one of the largest in Indian aviation and is the largest for Boeing in India,” he told journalists as he announced the deal.

“We are now in a very good position to expand our network and operations, which includes both domestic and international routes and destinations.”

The deal marks a major turnaround for SpiceJet, whose planes were briefly grounded in 2014 after suppliers refused to refuel them due to unpaid bills.

Analysts say the Indian airline sector has been boosted since then by lower fuel prices and a rise in consumer demand, with domestic traffic up 21 percent last year.

“The airline has done really well from being almost on the brink of closure to nearly seven quarters of profit,” said industry analyst Kapil Kaul.

“The new aircraft order is on expected lines and gives them long-term direction. A positive and long-term story is likely to emerge with this order.”

SpiceJet, whose market share is only lower than Indigo, Jet Airways and Air India, is the only Indian low-cost carrier with a Boeing fleet.

“We are honoured to be the partner of SpiceJet and to be in India in a big way and this is a demonstration of our commitment to our partners and to India,” said Raymond Conner, vice chairman of Boeing.

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