The Air India board has referred the purchase of Boeing 787 medium-size long haul jets, also called Dreamliners, to a group of ministers (GoM) headed by finance minister Pranab Mukherjee. The ministerial panel would now take the final decision on the controversial issue at its meeting on October 27.
The airline has argued that the capacity of the Dreamliner airplanes suits it better for optimal use on several key international routes. Besides, it has secured almost interest-free loan from the US Exim Bank for the purchase order.
?A final view on taking the delivery of the B787 would be taken by the GoM,? Air India CMD Rohit Nandan told FE.
One of the government-nominated director on AI board, EK Bharat Bhushan, had at the last board meeting wanted to know how the airline management planned to fund the Dreamliner purchase in the face of its poor financial health.
Industry sources said that American aircraft manufacturer Boeing has communicated to the national carrier that it would deliver two B787s in the current financial year after a delay of almost three years.
AI had placed the order to buy 27 B787s with Boeing in 2006 the delivery of which was to begin in May 2008. The delay has caused the airline losses both in opportunity and business and hence it has asked the airplane maker to compensate for it. AI has asked for $900 million in compensation for the delay. Boeing is, however, yet to mutually decide the amount to be paid to the carrier to make up for the losses. An official in the Boeing said that the company stands by its earlier position that first B787 would be delivered to AI by December 2011.
AI is meanwhile planning to deploy Dreamliner on long-haul routes where it is currently servicing with B777 long range airplanes. It has also identified Delhi-Melbourne as a possible route for the new medium-sized jets.
?The B777s are large jets and its cost of operation is high. When the load factor is low on these jets flying it does not make business sense. We could replace these aircraft with the B787s as it is mid-sized with 225 seats and also more fuel efficient,? said an AI official.