Indian airlines, Air India, in a multi-billion-dollar deal agreed to purchase over 500 airplanes from French company, Airbus, and American company Boeing. With this, Air India made history in the aviation industry. Obviously, this didn’t happen in a day or two, instead, it took months.
Recently, Tata Group celebrated one year anniversary of acquiring Air India and stated that they would transform the airlines. Now, this deal is a living example that Air India is paving its way to success and making India one of the biggest aviation industries.
London, The Epicentre Of Deal Talks
The deal was in the pipeline for over a year, however, serious talks began only last summer and lasted till when the world neared Christmas. Insiders shared a few details with Reuters only on the condition of anonymity.
A majority of talks took place at St James’ Court- a luxurious Victorian hotel near Buckingham palace in London. Amidst the chitter-chatter of the hotel, negotiators from airlines, aircraft manufacturers, and engine giants stayed awake till dawn to form a perfect deal that would benefit all.
Benefits That Everyone Sought
With this deal in the pipeline, Boeing was aiming at re-establishing its position in the Indian market after Boeing’s 737 Max jets crisis; while Airbus also sought a bigger share in the Indian aviation market which was already being led by its competitor, Boeing.
On the other hand, India’s intention was to win back its visitors and the diaspora who started flying in highly-efficient Gulf airlines.
With everyone involved seeking different benefits, politics was there and talks were really tough.
Tough Talks Continue
The deal was led by Nipun Aggarwal, Air India’s chief commercial and transformation officer and Yogesh Agarwal, head of aircraft acquisitions. Their talks, at times, kept them awake through the night as the sellers kept bringing new offers to the table.
A source said, “Air India has negotiated hard and the team is very perceptive despite having no prior aviation experience. You can compare yourself to some of the best dealmakers in the industry.”
The negotiations which were going on for months ceased at a dinner at Michelin-starred Quilon Indian restaurant that is best known for its seafood and coastal cuisine of Kerala and Goa.
Though the deal saw a battle between the airplane manufacturers, engines are the ones that either make or break the deal. Hence, engine talks were going on in full swing, but the anniversary of Tata Group acquiring Air India came through, and thus, the talks were halted.
When the talks resumed, General Electric emerged as the winner amongst all the engine manufacturers as it got a lion’s share in the engine deal.
According to the analysts, the obstacles weren’t limited to the deal talks, they’ll pop up as the project goes further. However, this deal shows that India’s aviation industry has potential and now no one can stop it from being a leader of the aviation industry around the globe.
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