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Mumbai - Singapore Airlines (SIA) has decided to lease 20 Airbus A320s for the launch of its Indian carrier, a joint venture with the giant Tata Group, the new company says.
Singapore Airlines chose the A320s over Boeing's 737s and will source the 20 planes from leasing companies rather than buying direct from Airbus, said Tata-SIA spokesperson Sanjay Singh on Thursday.
"It's going to be an Airbus A320 fleet. The aircraft will be on lease," he said.
Approval
Singh did not disclose the cost of the lease arrangements, which were sealed some 10 days ago, but media reports put the deal at $1.8bn.
The Tata-SIA airline will likely start flying around July, Singh said, after it gains regulatory approval in India.
Indian tea-to-steel conglomerate Tata will hold a 51% stake and Singapore Airlines 49% in the new venture, announced in September, as they seek to exploit one of the world's fastest-growing aviation markets.
The airline, which will have an initial combined investment of $100m from the two stakeholders, marks the third foreign direct investment in the Indian sector since the government declared last year that international airlines could buy as much as 49% of local carriers.
Upgraded model
The new airline has started recruiting pilots and is finalising its top staff, with a SIA executive expected as its chief.
The Tata Group is setting up another airline venture in India with Malaysia-based budget carrier AirAsia, which is expected to start operations early this year.
Jet Airways said in November that it had completed the sale of a 24% stake to Abu Dhabi's Etihad.
India's airline industry is dominated by budget airlines such as IndiGo which has 73 A320s in its fleet. It has placed an order for an additional 180 planes, including A320s, and upgraded model the A320neo.
