India’s Akasa Air has placed an order for 150 Boeing 737 MAX aircraft at the Wings India event taking place from January 18 to 21, 2024 in Hyderabad, India. As previously reported by AeroTime, the Mumbai-based carrier will use the new aircraft to increase its market share and to expand its route network, which is due to see the addition of international destinations in the coming years.
The announcement could not come at a better time for Boeing and its beleaguered 737 MAX product range, following the mid-air plug-door incident involving a 737 MAX 9 belonging to Alaska Airlines earlier in January 2024.
Akasa Air, which began flying commercially less than two years ago, announced the purchase of 150 737 MAX 10s and 737 MAX 8-200 aircraft to be delivered before 2032. The order, however, does not include the MAX 9 variant involved in the January 5, 2024, Alaska Airlines incident.
Akasa Air’s total order book now stands at 226 aircraft, which will be used to bolster the carrier’s domestic and international expansion plans. The airline, which currently operates a fleet of 22 MAX aircraft on domestic routes spanning India, will continue to rely on sale and leaseback financing for its new order, according to the airline’s Chief Financial Officer, Ankur Goel.
Akasa Air is India’s newest airline and has already managed to gain a 4% market share in the Indian domestic market since commencing operations in 2022. However, this figure is dwarfed by the 60% held by IndiGo, as well as the combined market share of 26% held by the TATA Group-owned airlines (Air India, Air India Express, and Vistara).
This latest order will be in addition to the outstanding order for 76 737 MAX 8 aircraft that Akasa Air already has in place with Boeing, as the carrier strives to gain a significant foothold in the Indian domestic market – currently the fastest-growing aviation market worldwide.
The announcement of the order by Akasa Air deal is the latest in a wave of orders for new aircraft placed by Indian carriers in the past 12 months. The airline industry in India is betting big on a forecast surge in air travel demand from the growing middle-class population in India with its high propensity to travel. Airlines such as IndiGo, India’s biggest airline, and Air India have both placed record deals for more than 900 aircraft with Boeing and Airbus in the past year alone.
The airline says its latest Boeing deal is proof of the carrier’s “solid financial foundation”. Akasa currently flies to 18 cities across India, including the busiest Mumbai-New Delhi route, and plans to expand its network to the Middle East and Southeast Asia.
Other recent deals for the Boeing 737 MAX family have indicated a list price of around $133 million for the MAX 10 variant and approximately $100 million for the MAX 8-200, the high-density low-cost variant of Boeing’s most popular product of all time.
With these prices, Akasa Air’s order could be worth as much as $17.5 billion. However, it should be noted that airlines are typically offered significant discounts on the list prices, particularly when placing large orders such as this.