Air India has made the pre-delivery payments for its record order of 220 jets with Boeing. In an internal staff communication, the director of finance, Vinod Hejmadi has confirmed the news of pre-payment.
"The funds were arranged from multiple banks at a very competitive rate and converted to US dollar at the best rates. We had a very short period to arrange the funds," Hejmadi said in the letter.
Reports suggest that pre-delivery payments can amount to up to 30% of the price of the aircraft.
The list price of the 220 Boeing aircraft ordered is valued at $34 billion. However, considering the fact that the airline has placed additional options for 50 737 MAX aircraft and 20 787s, the entire value of the order on Boeing's side comes up to almost $45.9 billion.
The order for 190 737 MAX includes the MAX 8 and the MAX 10 models, which are expected to be operated by the Air India Express as the airline exclusively operates the type.
The widebody aircraft is expected to be integrated into the main fleet as the airline already operates 787s and B777s. The new 787s and 777s will replace the old and ageing aircraft enabling the carrier to continue its international expansion.