Planners Boeing Company and Airbus SE have met executives of India’s Tata Group in recent weeks to discuss future aircraft orders for Air India, two people familiar with the matter said.
Tata last month acquired ownership of state-run carrier Air India after nearly 70 years in a $2.4 billion equity-and-debt deal. While the airline has lucrative landing slots, the group faces an uphill task of upgrading Air India’s old fleet and transforming its financials and service levels.
Air India has a mixed fleet of more than 140 Airbus and Boeing aircraft, and industry executives estimate that refurbishment of older planes will cost Tata more than $1 billion.
There was no immediate comment available from any of the companies involved.
Bloomberg reported on Thursday that Tata had initiated preliminary discussions with planners and lessors for jets including Airbus A350-900s and Boeing 787-9 Dreamliners, citing people familiar with the matter.
The airline, along with its Maharaja mascot, was once renowned for its lavishly decorated aircraft and service championed by founder JRD Tata. Air India was established in 1932 and was nationalized in 1953.
However, since the mid-2000s, Air India’s reputation has declined as the financial crisis escalates. It flew widebody aircraft with business class seats in poor repair and used some of its new 787s for spare parts.
Tata, the auto-to-steel conglomerate, operates two other airlines: Vistara, in a joint venture with Singapore Airlines, and AirAsia India, which it operates in partnership with the AirAsia Group.
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