Air India seeks to switch from sale-lease-back to purchase model

The airline has written to the government saying that it is allowed to buy plane by taking several loans. A senior Official used, “The redelivery charge can be in the range of $10-15 million for narrow body aircraft and as high as $15-25 million for wide body planes like the Boeing 787 Dreamliner.”

AI has ordered 27 Dreamliner and the funding for many of them is yet to be arranged for which the airline wants to adopt the outright purchase model. While, the current list price of a Dreamliner is $206 million.

The official, “In the sale and lease back model, we return aircraft to leasers after 12 Years and after spending huge sums of money. In outright purchase, the aircraft is completely owned by us when the 12 year repayment period for loan is over. We can use this aircraft for another eight years as the commercial life of a plane like the Dreamliner is about 20 years. At the end of that period too, the aircraft would have some residual value which can come to the airline.”