Boeing: Don't Expect Indian Carriers To Defer, Cancel Orders
March 31 2009 - 8:26AM
Dow Jones News
Boeing Co. (BA) reiterated Tuesday that it doesn't expect any
Indian carriers to defer or cancel orders already placed with the
U.S. plane maker despite a slowdown in the air travel sector.
Boeing has to deliver 100 planes worth $17 billion to Indian
carriers over the next five years, Dinesh Keskar, president of
Boeing India said.
"We have had zero cancellations in India" despite the economic
downturn, Keskar told reporters on the sidelines of a news
conference held to open Boeing's research and technology center in
the southern Indian city of Bangalore.
"We managed our order book and that's why today we are reaping
the benefits (of no cancellations)," Keskar said.
Boeing is due to deliver 44 aircraft to flag carrier Air India,
while Jet Airways (India) Ltd. (532617.BY) and its low-fare unit
JetLite are expected to take delivery of about 35 planes by
2014.
Budget carrier SpiceJet Ltd. (500285.BY) said last month it
doesn't plan to defer or cancel any orders and plans to take
delivery of nine aircraft from Boeing by March 2012. It will then
have a 30-plane strong fleet.
A slowing economy and higher fares induced by oil price have
damped demand in the Indian air travel market, forcing several
carriers to cut costs via pruning routes, reducing staff and
deferring aircraft orders.
Kingfisher Airlines Ltd. (532747.BY) has already been forced to
defer taking delivery of 32 of 48 Airbus A320 planes that were due
for delivery in late 2008 and in 2009.
"Jet Airways had deferred the delivery of two airplanes last
year, but they haven't come back for more (deferrals) since then...
SpiceJet is taking delivery of its planes," Keskar added.
In February also, the company had said it didn't expect any
order cancellations in India.
Both Kingfisher and Jet Airways are returning planes for which
leases have expired and are also leasing out their own planes to
foreign carriers.
Keskar said Boeing is "bullish" on India's aviation sector. The
company hasn't revised its forecast - made last year - that India
will need 1,001 aircraft worth more than $105 billion over the next
20 years.
-By Rumman Ahmed, Dow Jones Newswires; 91-9845104173;
nitin.luthra@dowjones.com