Boeing Frustrations Reach Crescendo At Airline Founded By Warren Buffett Of India: 'We Just Don't Have Enough Aircraft To Fly'

Ladies and gentlemen, buckle up! The aviation industry is in for a bumpy ride, and it's not just turbulence we're talking about. The supply chain issues at Boeing and Airbus are reaching a boiling point, and Air India, the airline founded by Warren Buffett of India, is feeling the heat. Campbell Wilson, the CEO of Air India, has warned that these supply chain problems could continue for up to five years, and that's a game-changer for the industry.



The problems are real, folks. We're talking engine shortages, premium seat shortages, and other critical aircraft parts. This is a nightmare scenario for airlines like Air India, which are heavily reliant on these manufacturers. Wilson has called Air India a "victim of circumstance," and he's right. The airline has taken delivery of 15 aircraft in 2024, including three ex-Vistara airframes, and its low-cost subsidiary, Air India Express, welcomed 27 Boeing 737 MAX 8 aircraft. But that's just a drop in the bucket compared to the 523 aircraft still on order.

The supply chain issues are not limited to Air India. Airbus CEO Guillaume Faury has outlined that the ramp-up of production rates will continue in a complex and fast-changing supply environment with persisting supply chain issues. Boeing, on the other hand, has faced additional internal problems, including the Alaska Airlines 737 MAX 9 mid-air door plug blowout and a 52-day strike by the International Association of Machinists and Aerospace Workers (IAM). These internal problems have further compounded the external challenges that Boeing and its suppliers have had to deal with in the past few years.

The long-term effects on Air India's fleet expansion plans are significant. The delay in deliveries means that Air India may face a significant backlog in receiving these aircraft, which could hinder its ability to expand its fleet and increase its capacity. The supply chain issues are not limited to Air India but affect the entire aviation industry. Airbus CEO Guillaume Faury mentioned that the ramp-up of production rates will continue in a complex and fast-changing supply environment with persisting supply chain issues. This means that even if Airbus and Boeing manage to increase their production rates, the delivery of aircraft to airlines like Air India may still be delayed.

The ongoing supply chain issues at Boeing and Airbus are likely to create a competitive disadvantage for airlines like Air India that are heavily reliant on these manufacturers. The delays in aircraft deliveries will limit their ability to grow capacity and expand their services, potentially giving an advantage to airlines that have more diversified supply chains or are less dependent on these manufacturers.



So, what can Air India do? The airline can consider retrofitting existing aircraft, as it has already done with an A320neo, registered as VT-EXN. This single-aisle jet has a new interior and was painted in the carrier’s new livery, with plans to retrofit another 26 A320neos. This approach can help Air India improve its fleet without relying on new deliveries. Additionally, Air India can explore partnerships with other aircraft manufacturers or consider leasing aircraft to meet its operational needs. For example, the airline could look into acquiring aircraft from manufacturers like COMAC, which is producing the C919 aircraft. This could provide Air India with an alternative to the Airbus/Boeing duopoly and help mitigate the supply chain issues.

Furthermore, Air India can focus on improving its operational efficiency and customer experience. The airline is introducing premium economy on its narrowbody fleet for the first time, which can attract more passengers and increase revenue. By enhancing its services and maintaining a strong brand, Air India can continue to grow despite the supply chain challenges.

In summary, the supply chain crisis at Boeing and Airbus poses significant challenges for Air India's growth and operational strategies. However, by retrofitting existing aircraft, exploring partnerships with other manufacturers, and focusing on operational efficiency, Air India can mitigate these challenges and continue to expand its operations.