How a Supply Chain Glitch Handed Air India 50 Boeing Jets Originally Meant for China

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In an unexpected stroke of luck, Air India Ltd. has been able to secure a steady flow of Boeing 737 Max aircraft at a time when airlines worldwide are struggling with delivery delays. However, this windfall of jets originally built for Chinese carriers is coming to an end.

Since September 2023, Air India has been receiving two Boeing 737 Max planes per month as the U.S. manufacturer cleared a backlog of jets that were initially meant for Chinese airlines. The reason? Chinese carriers, including Shanghai Airlines Co., delayed their orders due to regulatory concerns over lithium batteries in the planes’ cockpit voice recorders. This allowed Boeing to redirect the undelivered jets to Air India, offering the airline a rare advantage in a market where aircraft demand far outweighs supply.

Air India placed a massive order for 190 Boeing 737 Max aircraft in June 2023 as part of its expansion strategy. Its low-cost subsidiary, Air India Express Ltd., has already taken delivery of 41 out of 50 “white-tail” planes—a term used for aircraft built but left without an owner.

With just a few more deliveries remaining, Air India is set to receive four more jets in April and five between May and June. After that, however, the pipeline of diverted jets will dry up, leaving the airline uncertain about fresh deliveries.

While Air India has benefited from this supply chain quirk, its access to additional jets will now depend on Boeing’s regular production and delivery schedules which have been plagued by delays and production bottlenecks.

The airline, undergoing a massive transformation under the Tata Group, has been aggressively expanding its fleet to meet rising demand for domestic and international travel. With the stream of diverted jets running out, it remains to be seen how the airline will navigate potential delays in securing new aircraft in the coming months. Air India’s unexpected Boeing bonanza is nearing its final chapter.

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