AI claims $710 million for late B787 deliveries, cancels B777 orders

New Delhi: Struggling State-owned carrier, Air India, has claimed $710 million from Boeing Co for late delivery of the futuristic 787 Dreamliner aircraft and has also cancelled orders for five Boeing 777 planes, according to a local report.

It has 27 such aircraft on order with Boeing.

"The cancellation orders have already been issued by my engineering department," Air India chairman and managing director Arvind Jadhav has been quoted as saying in a local report.

According to the report, Jadhav claimed that the company had suffered large losses because of Boeing's failure to deliver the 787 planes on time. "The entire schedule of Air India has gone haywire. We have put a claim of $710 million for their failure to deliver the aircrafts to us in time," he said.

Air India and Boeing are yet to comment on the report.

Air India agreed to purchase 68 Boeing airplanes in 2006 in a deal estimated to be worth around $8 billion. This involved the purchase of 23 B-777s, 27 B-787-8 Dreamliners and 18 next-generation 737-800s.

The state-owned carrier has posted an annual loss in the region of a billion dollars for the fiscal year ended 31 March, and is currently angling for a large government bailout.

Faced with increasing competition from domestic carriers and an adverse economic situation it is seeking to cut costs by rationalising routes and aircraft deliveries.