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Indian Airlines May Order 400 Aircraft This Year: Report

: Mar 3, 2014 - : 10:05 am

 
 
India’s airlines will order as many as 400 aircraft in 2014, a year that is also expected to see growth return to aviation but with pressure on profit, according to a report.
 
“Indian carriers expected to order up to 400 aircraft this year in addition to those already on the order books,” said Centre for Asia Pacific Aviation or Capa in its Outlook for 2014-15.
 
Air India, Jet Airways, IndiGo, SpiceJet, GoAir, JetKonnect and Air Costa together have around 400 aircraft in their fleet and 350 on order. “By the end of FY2015 this is likely to have swelled to over 700 aircraft,” the report noted.
 
Vijaywada-based Air Costa just ordered 50 Brazilian-made Embraer jets at the Singapore air show last fortnight valued at $2.94 billion.
 
This year is also likely to see the launch of a Tata Group airline in alliance with Singapore Airlines. The group has already ordered 20 A320s, Capa said.
 
“Jet may also be allocated some of the more than 100 wide body aircraft ordered by Etihad at the Dubai Air Show in Nov 13. Meanwhile, IndiGo is expected to place another massive order for 200-250 additional aircraft,” the report added.
 
In 2013-14 domestic traffic is up 6% and international traffic for the first eight months is up 10.7%. The firm said it expects domestic growth to be in “low single digit” at 1-5% for the coming fiscal year also but projects international traffic growth at 10-12%.
 
Air India Ltd, Jet Airways (India) Ltd and SpiceJet Ltd are expected to stories combined losses in excess of $1.2 billion in the current financial year. And this figure could rise higher as a weak outlook for March could trigger further promotional pricing, Capa said.
 
“Air India is once again expected to incur the largest loss at close to $700 million, although this represents an improvement of approximately 20% year-on-year in local currency terms,” it said.
 
Jet Airways and SpiceJet are likely to report record losses, it added. In addition to their losses, Air India and Jet Airways are also likely to be impacted by travel agency defaults which have reached $40 million in Delhi alone in recent weeks and could rise further, it said.
 
“GoAir is expected to end the year with a break-even result or a modest profit which is disappointing after a very promising first quarter. IndiGo will be the only carrier to report full year profitability but this too will be significantly lower than our earlier estimates,” it said.

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