SpiceJet Heats Up Competition Between Boeing And Airbus
SpiceJet is planning to acquire almost 150 jets and currently undergoing frequents discussions with Boeing and Airbus.
SpiceJet is repeatedly being reported of having discussions with two aircraft manufacturers, both of them are rivals, Airbus and Boeing Co. It is under negotiations in order to acquire almost 150 jets from the companies to increase its growth and operations.
There have been no reports of the discussions between the companies reaching and finalizing any deals yet, however 150 commercial airplanes contract is a huge deal to both the aircraft manufacturers. The decision as to who will be the providers of the jets will be made till March next year.
SpiceJet’s chairman informed about the meetings to the public on Sunday. The airline has its eyes on Boeing’s 737 Mac and Airbus’s A320 Neo jet. These are not only jets concerning the airline but it has also indicated of attaining 50 more airplanes, however comparatively smaller in size from companies, such as Embraer, ATR and others.
The airline currently has 41 airplanes and already has a pending order, 42 of Boeing Co.’s 737 Max jets, which are expected to be delivered in 2017. The chairman and the managing director of the airline, Singh, said during a conference held in Dubai, “We are in the process of placing a large aircraft order, the airline will order in excess of 15- jets- we hope to do that in this financial year.”
The airline might only select one supplier, which raises more competition and heat between the two aerospace companies. It is clear that the contract will cost huge sums of money, as 150 jets will not be cheap, however no specific value has been revealed yet. It is making enough annual revenue to afford the deal but it might take the aid of other finance providers.
This is a very good opportunity for both aerospace companies to grab on but Boeing needs the contract more than Airbus, as it scored 850 orders while the other was able to achieve 566 orders. It was able to deliver and fulfill more order in comparison to its competitors with a delivery of 638 planes, while the rival only delivered 495 of the deliveries.
Boeing also predicts that Asia will soon be the aviation industry’s major market globally, with fresh orders of almost 14,330 airplanes, constituting 37.66% of the total global demand. It is expecting to achieve 1740 of order out of the 14330 fresh orders that are expected to be placed.
Boeing stock closed at $147.80, going green by 1.62% on December 1.