Indian Akasa Air signs $ 4.5 billion deal with engine manufacturer CFM International


Investor Rakesh Jhunjhunwala poses for a photo in his office in Mumbai on June 8, 2012. REUTERS / Vivek Prakash

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BENGALURU, Nov. 17 (Reuters) – Indian low-cost airline Akasa Air on Wednesday announced that it has signed an agreement with CFM International for its LEAP-1B engines in a deal valued at nearly $ 4.5 billion. dollars at list price to power the 737 MAX planes she recently purchased.

The deal comes after billionaire investor Rakesh Jhunjhunwala, backed by Akasa Air, on Tuesday placed an order for 72 Boeing (BA.N) 737 MAX jets, valued at nearly $ 9 billion at list price. Read more

Jhunjhunwala, known as ‘Warren Buffett of India’, has partnered with former managing directors of IndiGo, the country’s largest carrier, and Jet Airways (JET.NS) to tap the demand for travel by domestic plane, which is approaching pre-pandemic levels as the country recovers from a devastating outbreak earlier this year.

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The deal also includes aftermarket engines and long-term services, the companies said in a joint statement.

The LEAP-1B engine entered service on the Boeing 737 MAX in 2017, and more than 2.5 million engine flight hours have been logged, the companies added.

SNV Aviation, which will fly under the Akasa Air brand, plans to begin operations next year after obtaining initial clearance from the Ministry of Civil Aviation to launch the country’s latest ultra-low-cost carrier.

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Reporting by Chandini Monnappa in Bengaluru and Aditi Shah in New Delhi; Editing by Krishna Chandra Eluri

Our Standards: Thomson Reuters Trust Principles.

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