Air India's Strategic Move Amid US-China Tariff War

In a bold move that underscores the shifting dynamics of global trade, Air India is reportedly in talks to acquire Boeing Co. aircraft initially destined for Chinese airlines. This development comes as the airline seeks to bolster its fleet amidst ongoing trade tensions between the United States and China, sparked by former President Donald Trump's tariff policies.

The Tata Group-owned airline is on a mission to transform its operations and requires additional aircraft to support this ambitious endeavor. Sources close to the matter have revealed that Air India plans to reach out to Boeing regarding several undelivered aircraft, originally prepared for Chinese carriers but left in limbo due to trade-related tariffs.

Global Implications and Opportunities

This isn't the first time Air India has turned trade tensions to its advantage. The airline previously acquired 41 737 Max aircraft meant for Chinese airlines, following the model's grounding in 2019. Meanwhile, Malaysia Aviation Group Bhd. is also exploring similar opportunities, discussing potential delivery slots with Boeing that were initially allocated to Chinese carriers.

Chinese airlines, under governmental directives, have been avoiding Boeing aircraft in response to Beijing's imposition of reciprocal tariffs on American-made products. This situation has left approximately 10 aircraft ready for delivery in a state of uncertainty, with some 737 Max jets even returning to the United States.

Challenges and Prospects for Indian Airlines

The current scenario presents both challenges and opportunities for Indian airlines. Aircraft already manufactured or in production by Boeing come with predetermined cabin layouts and partial payments made by original customers, complicating potential acquisitions. However, with Chinese airlines awaiting delivery of around 100 B737 MAX and 11 B787 Dreamliners, there's a silver lining for Indian carriers like Air India Express and Akasa, which are in dire need of these models.

Industry experts anticipate that some of these aircraft may be redirected to Indian customers, offering a much-needed respite for airlines grappling with supply chain constraints. This could mark a significant turnaround for Akasa, which has faced operational hurdles due to delayed Boeing deliveries, leaving it with more pilots than required for its current fleet.