Rakesh Jhunjhunwala's Akasa Air orders 72 Boeing 737 MAX aircraft
Ace stock market investor Rakesh Jhunjhunwala-backed Akasa Air struck a deal with Boeing to buy 72 fuel-efficient 737 MAX airplanes on Tuesday. The soon-to-be-launched airline's order is reportedly valued at $9 billion. The order reportedly includes 737-8 and high-capacity 737-8-200 airplanes. Akasa Air is expected to start operations from summer 2022 as an ultra-low-cost airline.
Why does it matter?
- India had recently allowed modified B737 Max to fly. The aircraft was banned in March 2019 after two fatal crashes.
- The deal marks a step forward for Akasa Air, which received its no-objection certificate from the Ministry of Civil Aviation in mid-October.
- India is also witnessing a surge in demand for commercial aircraft as flight operations return to pre-pandemic levels
What did Akasa Air say about the deal?
Speaking at the 2021 Dubai Airshow, Akasa Air CEO Vinay Dube thanked Boeing for "their trust and confidence in Akasa Air's business plan and leadership team." "New 737 MAX airplane will support our aim of running not just a cost-efficient, reliable and affordable airline, but also an environmentally friendly company with the youngest and greenest fleet in the Indian skies," Dube said.
Akasa to 'democratize air travel'
Akasa Air wants to help "power India's growth engine and democratize air travel by creating an inclusive environment for Indians regardless of their socio-economic or cultural backgrounds," Dube said. He further said 737 MAX would ensure the airline has a competitive edge in the domestic market by providing the lowest seat-mile costs for a single-aisle airplane, high dispatch reliability, and an enhanced passenger experience.
'India among fastest growing aviation markets'
India is one of the fastest-growing aviation markets in the world "with an unparalleled potential," Dube said. "We are already witnessing a strong recovery in air travel, and we see decades of growth ahead of us," he added.
737 Max perfect for Akasa Air: Boeing
The 737 Max is the perfect airplane to establish Akasa Air with "its optimized performance, flexibility, and capability," said Boeing Commercial Airplanes President and CEO Stan Deal. According to Boeing, the 737 MAX aircraft delivers superior efficiency, flexibility, and reliability. It also reduces fuel use and carbon emissions by at least 14% compared to other airplanes.
Why was 737 Max banned?
India's Directorate General of Civil Aviation (DGCA) had lifted the ban on Boeing 737 Max airplanes this August. The aircraft was banned after two fatal crashes—the Lion Air Flight 610 crash in the Java Sea in October 2018, and the Ethiopian Airlines Flight 302 crash near Bishoftu in March 2019. A total of 346 people were killed as both crashes occurred shortly after take-off.