Air India may lease planes after Boeing delivery delays

Faced with rising maintenance costs and a delay in delivery of aircraft, state-run Air India is looking to lease out six of its large Boeing 777 aircraft and instead hire at least 10 midsize Airbus A330 planes. A final decision will be taken in a month after a government committee finishes studying the proposal.
 
According to a Mint report, Arvind Jadhav, chairman and managing director of Air India's holding company National Aviation Co of India Ltd, confirmed there is a proposal from the airline's engineering department asking for midsize aircraft, given delays in the delivery of Boeing 787s which were supposed to replace old Airbus A310 aircraft that are being phased out.

''This proposal is referred to a committee headed by additional secretary and financial adviser in the ministry of civil aviation … it is expected to give its report in a month's time,'' Jadhav said.

''At present, the maintenance cost of old A330s is high. Since we cannot buy the planes, we could look at short-term leases for new planes that will lower the maintenance cost as well as retain the market,'' said Jadhav, adding that Air India has asked US aircraft maker Boeing Co for compensation for the delays, without disclosing details.

A civil aviation ministry official, speaking on condition of anonymity, also confirmed the development, adding that ''the same committee that was set up in 2004 for fleet acquisitions will look into the proposals''. Both Jadhav and the ministry official declined to divulge details of the new orders.

The airline's move stems largely from a delay in delivery of Boeing 787, leading to difficulties in Air India retaining its current market in the large carrier space. Also, the decision to replace old aircraft such as A310s and A330s is to lower maintenance costs.

A Boeing 777 can seat up to 365 people, while the Dreamliners have a capacity of 250 passengers. The A330 can seat up to 290 people.