Last week, India’s largest carrier Jet Airways announced an order for 10 additional Airbus A330 aircraft; worth close to $2.5 billion at list price. These orders were (re) announced ahead of the big airshow in Paris; where both major manufacturers are expected to announce major orders. Of the 10 A330s, 5 are outstanding orders for the smaller Airbus A330-200, and 5 for the larger Airbus A330-300 (which will be leased from Intrepid Aviation).
According to the carrier, these new aircraft will be used to operate service to “Paris, Rome, Beijing, Shanghai, Amsterdam, and points in Germany.” To me, the inclusion of 5 SkyTeam hubs (all except for the points in Germany) points towards possible membership in SkyTeam. Earlier this year, news came out that Air France-KLM, Alitalia, and Delta wanted to add Jet to their trans-Atlantic joint venture (Jet operates a scissors-hub in Brussels with service to Toronto, New York JFK, and Newark). They’ve already inaugurated service to Milan from Delhi, and loads are apparently quite strong.
The candidness about this expansion is interesting because Jet is riding on a super high wave at the moment. They reported a nice profit for FY 2011, and also had their largest traffic month ever in May; carrying over 2 million passengers. They’re even feeling good enough about their business right now to take back 3 Boeing 777-300ERs that they had leased out to Thai Airways International. These aircraft will be deployed on the Mumbai-Brussels-Newark, and Mumbai-Hong Kong sectors. During the height of the recession, Jet canned many of their 777 flights and leased out 7 of their 10 frames. While there has been a recent pick up in demand, high fuel prices could affect their ability to re-take these 777s.
Ultimately, what this order signifies is that an Airbus A330-200 sized aircraft (200-250 seats) is correct for the Indian market. Jet seems to be getting very good results from them, so it’s not surprising to see them order some more. Plus,their main intercontinental competitor Air India seems to be running out of cash, and wants to defer its deliveries of a 200 seat jet (the 787). With further 787 deliveries not possible till at least 2018 (Jet does have 10 already on order), it is likely that they will order more A330s in the interim.