Skift Take

Airbus is increasingly capturing market share in India among budget airlines; a trend which could be troubling to Boeing and its long-term growth.

SpiceJet Ltd., the Indian discount carrier operating an all-Boeing Co. fleet, said it may consider a full switch to Airbus SAS aircraft as it weighs options for a new generation of planes.

“As long as you can manage the implications and the risks that you’re taking and there’s enough money in it” the company would consider the switch, Chief Executive Officer Neil Mills said in an interview in Mumbai yesterday. The carrier currently has 37 Boeing 737 aircraft and plans to add seven more of the planes this year, he said.

A switch by SpiceJet would further tilt India’s budget airline fleet market share in favor of Airbus, whose planes are used by IndiGo, India’s biggest domestic carrier by market share, and Go Airlines (India) Ltd. Such a move could further hurt Boeing as it works to implement safety upgrades to its 787 Dreamliner to end a two-month grounding of the fleet after a smoking battery forced an emergency landing Jan. 16.

Mills was part of the EasyJet Plc team that in 2002 oversaw the start of a transition at the U.K. carrier from an all-Boeing fleet to Airbus aircraft. EasyJet had 75 aircraft when it started the transition toward an Airbus fleet, Mills said.

SpiceJet will consider Airbus A320neos to replace its Boeing fleet, he said. “It’s the new generation of aircraft that offers the next level of technology,” Mills said.

737 Max

Shares of the budget airline fell 1.2 percent to 33.5 rupees as of 11:10 a.m. in Mumbai. The stock has declined 24 percent this year.

Boeing, based in Chicago, didn’t offer an immediate response to an e-mail seeking comments.

The planemaker said last month it’s in talks with SpiceJet and Jet Airways (India) Ltd. to sell its 737 Max single-aisle aircraft as the plane maker forecast Indian carriers would need 1,450 new planes through 2031.

Boeing has 1,064 firm orders globally for the 737 Max single-aisle planes, Dinesh Keskar, senior vice-president for India and Asia Pacific sales, said last month. In comparison, Airbus had 1,734 firm orders for the A320neos as of Dec. 31.

In 2011, IndiGo firmed up an order for 150 A320neos and 30 of the existing version of the A320, while GoAir confirmed a deal for 72 A320neos.

SpiceJet’s Mills said the carrier will separately consider adding as many as five Bombardier Inc. Q400 turboprops to expand its regional flights.

Editors: Aaron Clark and Kenneth Maxwell.

To contact the reporter on this story: Karthikeyan Sundaram in New Delhi at [email protected]. To contact the editor responsible for this story: Anand Krishnamoorthy at [email protected].


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Tags: airbus, Boeing, spicejet

Photo credit: A SpiceJet Aircraft at the Jaipur Airport. Balaji Narayanan / Flickr

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