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Airbus favoured to win US$6.6b Vistara deal

New Delhi

AIRBUS SE is favoured to pull in an order from Singapore Airlines affiliate Vistara for as many as 60 new-engine single-aisle airliners to gain a stronger foothold in the booming Indian market, according to people familiar with the negotiations.

The airline is leaning towards buying the A320neo jets after a contest with Boeing Co's 737 Max model, according to the people who asked not to be identified as the information isn't public. The carrier will make an announcement soon, one of the officials said. The A320neo has an an average list price of about US$110 million, valuing the deal at US$6.6 billion before discounts that are common in large aircraft purchases.

An order from Vistara, in which Indian conglomerate Tata Group owns a 51 per cent stake, is a consolidation for Airbus after the carrier is poised to give Boeing an order for widebody jets. Budget carriers IndiGo, run by InterGlobe Aviation Ltd, and SpiceJet Ltd are ordering hundreds of aircraft worth billions of dollars to tap an emerging middle-class flying for the first time, helping India become the world's fastest-growing major aviation market.

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Vistara would hand over a US$3.3 billion order to Boeing for 10 Dreamliners, including options, Bloomberg News reported on Saturday, citing people familiar with the development. Vistara had said earlier that it plans to start flying international routes by the second half of this year. The carrier plans to fly routes of three to five hours duration initially, which can be covered by narrowbody jets such as the A320. BLOOMBERG