New Delhi, 18 March - Campbell Wilson, the CEO of Air India, delivered a stark warning about the global aviation industry’s ongoing aircraft shortage, predicting that the crisis will persist for at least four to five years. Speaking at the Skift India Forum in New Delhi, Wilson pointed to persistent supply chain disruptions at major aircraft manufacturers Boeing and Airbus as the primary culprits behind the bottleneck. This shortage, he explained, is severely hampering airline growth worldwide, with Air India being no exception despite its ambitious plans for expansion and modernization under the Tata Group’s stewardship. The announcement comes at a pivotal moment for the airline, which has been undergoing a significant transformation since its privatization in 2022, aiming to reclaim its position as a leading global carrier.
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Wilson elaborated on the specific challenges plaguing aircraft production, identifying shortages in narrowbody jet engines, premium seating options like business and first-class seats, and critical fuselage components as key "pinch points." These issues stem from broader supply chain woes that have plagued the aerospace industry in recent years, compounded by Boeing’s internal setbacks, including a nearly two-month-long worker strike in 2024 and regulatory caps limiting its 737 MAX production to 38 units per month. Airbus, too, has struggled to meet delivery targets, with its CEO Guillaume Faury recently acknowledging a complex and fast-changing supply environment that has left some aircraft engineless—referred to as "gliders"—due to delays from engine suppliers like CFM International. For Air India, which operates a fleet of approximately 210 aircraft alongside its low-cost subsidiary Air India Express with about 90 planes, these delays have tangible consequences, forcing the airline to rely on aging jets longer than anticipated.
This reliance on older aircraft has driven up maintenance costs and slowed Air India’s modernization efforts, a critical component of its multi-billion-dollar revamp strategy. In 2023, the airline placed a historic order for 470 jets from Boeing and Airbus, including 190 Boeing 737 MAX planes and 10 of the much-delayed 777X aircraft, followed by an additional order for 100 Airbus jets later that year. However, Wilson expressed uncertainty about the delivery timelines, particularly for the 777X, quipping, "Who knows?" This candid remark underscores the frustration felt by airlines globally as they grapple with unpredictable schedules. Air India has even paused exercising its remaining options for additional Boeing jets until the manufacturer clears its backlog, a pragmatic move given Boeing’s ongoing recovery challenges.
The aircraft shortage has broader implications for Air India’s operational strategy. With capacity constrained, Wilson noted that the airline must be "ruthless" in deploying its existing fleet to maximize returns, limiting its ability to expand into new markets it would otherwise target. Leasing additional aircraft, a common stopgap measure, is not a straightforward solution either, as global demand for available planes outstrips supply, and integrating jets with differing configurations adds complexity rather than efficiency. Meanwhile, Air India’s retrofit program, aimed at upgrading its narrowbody and widebody fleets, has faced delays due to supply issues, with completion now projected for mid-2024 and 2027, respectively. Despite these hurdles, Wilson remains focused on long-term goals, emphasizing the need to refresh the fleet and capitalize on the growing demand for premium travel in India. As the airline navigates this "supply-constrained market," it finds itself, like its peers, a "victim of circumstance," with limited options but a clear determination to adapt and endure.