State-run Air India Ltd will start the process of financing seven Boeing Co. 787 Dreamliners by floating a request for proposal for about $850 million (Rs.3,842 crore) in April.
Air India’s seven Dreamliners are tentatively scheduled to be delivered between October and March next fiscal, according to two people familiar with the matter. The carrier has a total of 27 on order. Boeing has been unable to deliver the aircraft on time because of technical issues, causing delays of up to 3 years.
The Indian carrier plans two fund-raising options—from the market and the US Export-Import (Exim) Bank—according to the terms of Air India’s 2006 aircraft purchase deal with Boeing for a total of 68 planes, said one of the officials cited above. The person spoke on condition of anonymity.
The airline wants to test both financing options to see if either one or a mix of both will be less burdensome on its much-constrained cash flow. The carrier has a Rs.22,000 crore working capital loan, besides accumulated losses of around Rs.13,000 crore, both of which are likely to increase this fiscal.
Boeing hasn’t said exactly when 787 deliveries will start.
“The first airplane will be in the fourth quarter and we are in discussions about additional deliveries of the 787 to Air India,” said Boeing India president Dinesh Keskar without giving details.
Air India will be one of the first customers of Dreamliner after Japan’s All Nippon Airways Co., which is scheduled to get its first delivery in the third quarter of this calendar year.
14/03/11 Tarun Shukla/Live Mint
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