Air India is facing significant aircraft supply constraints for the next four to five years, according to CEO Campbell Wilson. Speaking at the Skift India Forum on March 18, 2025, Wilson detailed the challenges posed by global production delays affecting major manufacturers Boeing and Airbus, emphasizing the impact on the airline's ambitious turnaround plan.
Currently, Air India operates approximately 210 planes, with its low-cost subsidiary, Air India Express, maintaining about 90 additional aircraft. Last year, Wilson indicated plans for the Group’s fleet to grow to around 400 planes from the current 300 within three years, highlighting the urgency of the situation.
“We have placed orders for 570 planes (in the last two years). It would be fair to say there are pinch points everywhere,” Wilson explained. These pinch points include shortages of narrow-body jet engines, business and first-class seats, and components for aircraft fuselages. Such supply chain disruptions mean the aviation market is likely to remain "supply constrained" for another four to five years, impacting the entire industry.
Wilson noted, “If you are capacity constrained, you need to be a little bit more ruthless with respect to where you deploy aircraft to maximise the returns.” This sentiment rings true as Air India faces mounting pressures to effectively manage its existing fleet. With aircraft capacity limited, the airline must make tough choices about routes and services, hampering its expansion efforts.
The airline's retrofit program, which began last September, aims at modernizing its current aircraft, starting with narrow-body planes. Wilson announced completion is expected by mid-2024, followed by retrofitting wide-body planes stretching to 2027. “We are victims of circumstance, as is every other airline... there is not a lot we can do,” he affirmed, highlighting the shared struggle across the aviation sector.
Changes to the existing fleet include painting and refurbishing Vistara aircraft, expected to take around 1.5 years. Following the merger of Vistara with Air India, the integration of the two fleets has posed additional logistical challenges.
Leasing aircraft has proven to be complicated as well. The fierce competition for available planes, combined with varying configurations, complicates Air India's ability to bolster its fleet quickly. Wilson explained, “We can try to lease aircraft from the external market but every other airline is trying to do it. Getting one or two aircraft which has different configurations from the rest of the fleet adds to the complexity rather than advancing you.”
Under its multi-billion-dollar revamp plan, Air India has ordered 470 jets, including 190 Boeing 737 MAX aircraft and 10 of Boeing’s 777X jets, which have been delayed. Another order for 100 Airbus aircraft was also placed last year. Wilson stated candidly about the prospects for delivery of the 777X, saying, “Who knows?” This uncertainty reflects the broader difficulties Boeing has faced, as it struggles to ramp its production of 737 MAX aircraft due to federal limitations limiting output levels.
Despite these challenges, Air India continues its drive to modernize. The CEO emphasized the importance of retrofitting, shedding light on issues faced last year when plans for retrofitting legacy Boeing 777 planes were stalled due to supply issues. “We are now pulling these aircraft through heavy refresh programmes,” he remarked.
Looking to the future, Wilson conveyed optimism about the demand for premium travel, stating he believes it will rise as the Indian market expands, especially as more people travel for the first time. “We are seeing a continued improvement in yields and premium travel,” he noted, indicating cautious but hopeful forecast amid the growth potential the Indian aviation market holds.
From Wilson's perspective, external factors such as global economic uncertainties do pose challenges; yet he believes Air India is largely insulated from widespread economic disruptions due to India’s unique growth dynamics. “Anything impacting the global economy is concerning... I think our problem is actually one of supply rather than demand,” he stated, reinforcing the notion of opportunity amid adversity.
Even as Air India navigates these turbulent waters, the airline’s ambitious five-year transformation strategy under the Tata Group’s stewardship aims to not only improve fleet capabilities but also position the airline as a dominant player within the competitive aviation sector.
With plans to have some new aircraft featuring first-class cabins, Wilson iterated, “We do see a place for first class... and it is work in progress.” But he noted the complexity of this undertaking, as providing first-class service is seen as less profitable compared to business class, challenging for the airline positioning itself as Tier 1. Air India’s roadmap includes upgrading legacy fleets, with expectations of completing all retrofitting by mid-2027.
Overall, the combination of dramatic supply chain challenges, strategic decisions on resource deployment, and the admissions of being at the mercy of larger industry dynamics paint a complex picture for Air India's growth ambitions and operational strategy moving forward.
