Aerospace
Singapore approves the merger of Vistara and Air India and acquires a 25.1% share.
A major milestone for Air India.
Singapore Airlines (SIA) and Tata Sons (Tata) have agreed to merge Air India and Vistara, with SIA also investing INR 20,585 million (S$360 million, US$250 million) in Air India as part of the transaction. This would give SIA a 25.1% stake in an enlarged Air India group with a significant presence in all key market segments1. SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals.
SIA intends to fully fund this investment with its internal cash resources, which stood at S$17.5 billion as of 30 September 20222.
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SIA and Tata have also agreed to participate in additional capital injections, if required, to fund the growth and operations of the enlarged Air India in FY2022/23 and FY2023/24. Based on SIA’s 25.1% stake post-completion, its share of any additional capital injection could be up to INR 50,200 million (S$880 million, US$615 million), payable only after the completion of the merger.
The actual amount will depend on factors including the progress of the enlarged Air India’s business plan, and its access to other funding options. SIA intends to fully fund any additional capital injections with its internal cash resources.
Through this transaction, SIA will reinforce its partnership with Tata and immediately acquire a strategic stake in an entity that is four to five times larger in scale compared to Vistara. The merger would bolster SIA’s presence in India, strengthen its multi-hub strategy, and allow it to continue participating directly in a large and fast-growing aviation market.
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Mr Goh Choon Phong, Chief Executive Officer, Singapore Airlines, said: “Tata Sons is one of the most established and respected names in India. Our collaboration to set up Vistara in 2013 resulted in a market-leading full-service carrier, which has won many global accolades in a short time.
India is the fastest growing global economy, and is projected to become the third largest in the world by 20273. It is also the world’s third largest aviation market. Demand for air travel is surging with passenger traffic expected to more than double over the next 10 years, supported by rising income levels and ongoing investments in its aviation infrastructure. However, India also remains underserved with low international seats per capita, signifying significant growth potential4 .
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Following its acquisition by Tata in January 2022, Air India unveiled a wide-ranging transformation programme to strengthen its foundations and revamp its operations, setting it on the road to recovery and positioning it for growth5.
The combination of Air India and Vistara would bring significant synergies. Air India has valuable slots and air traffic rights at domestic and international airports that are not available to Vistara. With Vistara widely recognised as India’s leading full-service carrier, Air India will benefit from its operational capabilities, customer base, and a strong focus on customer service and product excellence.
Today, Air India (including Air India Express and AirAsia India) and Vistara have a total of 218 widebody and narrowbody aircraft, serving 38 international and 52 domestic destinations. With the integration, Air India will be the only Indian airline group to operate both full-service and low-cost passenger services. It can optimise its route network and resource utilisation, be flexible and agile in capturing demand across market segments, and tap on a larger consumer base to strengthen its loyalty programme.
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This would reinforce its position as India’s largest international carrier and second largest domestic carrier, allow it to offer more options and connectivity for business and leisure customers, and enable it to compete as a leading global airline.
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1Today, SIA and Tata hold a 49% and 51% stake in Vistara respectively. Tata wholly owns Air India, which includes the low-cost carriers Air India Express and AirAsia India.
2In addition to its cash and bank balances of S$17.5 billion, the Group retains access to S$2.2 billion of committed lines of credit, all of which remain undrawn. SIA intends to redeem the 2020 Mandatory Convertible Bonds on 8 December 2022, and cash and bank balances will decline by S$3.86 billion on a pro-forma basis on that date.
Aerospace
Which is bigger 777x or 787 aircraft ?
The 777X is a new series of the Boeing 777 family and is designed to be larger and more efficient than its predecessor. It features two variants: the 777-8 and the 777-9, being the larger of the two.
The Boeing 777X emerges as the larger sibling within the Boeing family, representing a significant leap forward in both size and efficiency. Comprising two variants, the 777-8 and the 777-9, the latter takes the crown as the larger of the two. With its expansive fuselage and impressive wingspan, the 777X is tailored for long-range journeys and boasts a substantial passenger capacity.
On the other hand, the Boeing 787, affectionately known as the Dreamliner, occupies a niche in the market as a smaller yet formidable aircraft designed for medium to long-range flights. Its distinguishing feature lies in its composite fuselage, a technological marvel that renders it lighter and more fuel-efficient compared to conventional aluminum counterparts. The Boeing 777X is larger than the Boeing 787 aircraft.
When it comes to passenger capacity, the 777-9 reigns supreme, typically accommodating a sizeable contingent of 400-425 passengers in its standard configuration. In contrast, the 787, with its more modest dimensions, typically carries between 240-290 passengers, depending on the variant and layout.
One of the remarkable innovations introduced with the 777X is its folding wingtips, a feature designed to address the logistical challenges of accommodating such a large aircraft in conventional airport gates. These folding wingtips enable the 777X to retract its wings, allowing it to fit into gates designed for smaller aircraft while still reaping the benefits of an extended wingspan during flight, thereby enhancing fuel efficiency and operational flexibility
Aerospace
China Secures Production Certificate for Mass Production of Pilotless eVTOL Aircraft
The first passenger-carrying pilotless electric vertical takeoff and landing (eVTOL) aircraft in the world, the EH216-S, has received the Production Certificate for its eVTOL aircraft from the Civil Aviation Administration of China (CAAC).
This is a significant milestone for EHang Holdings Limited, the leading UAM technology platform company in the world. This outstanding accomplishment is another big step towards mass manufacturing for the eVTOL aircraft and the ensuing commercial operations, building on the ground-breaking acquisition of the Type Certificate and the Standard Airworthiness Certificate for the EH216-S.
The PC is a crucial certificate that the aircraft maker receives from the CAAC, the country’s aviation authority. By obtaining this certificate, EHang has demonstrated that it has set up a quality management system for mass production that satisfies the airworthiness regulation standards set forth by the CAAC, and the company has been given permission to continue producing mass quantities.
It is also a strong guarantee of the calibre of the goods made by EHang. Raw materials, supplier management, manufacturing organisation, production quality control, aircraft pre-delivery test, after-sales repair and maintenance, etc. are all included in the mass production quality management system for the EH216-S.
To ensure that every aircraft and its components that roll off the production line strictly adhere to the approved type design and safety requirements, the system sets clear guidelines and documentation for every step in the production procedure. This ensures comprehensive traceability and safety control.
Aerospace
Four Airbus A380 Superjumbos lined up to be scrapped
In a strategic move aimed at reclaiming valuable resources from the iconic Airbus A380 aircraft, VAS Aero Services and Dr. Peters Group have announced a significant collaboration.
This partnership marks a milestone in aviation logistics and aftermarket services, with four of these colossal planes slated for teardown and redistribution of used serviceable material (USM).
The venture between VAS Aero Services, renowned for its expertise in aircraft dismantlement, and Dr. Peters Group, a prominent Germany-based investment fund management firm, underscores a commitment to sustainable aviation practices. This isn’t their first foray into scrapping A380s; their successful partnership has already seen the dismantlement of these aircraft, making them pioneers in this niche.
Under the agreement, the latest consignment brings the tally to eight A380s entrusted to VAS by Dr. Peters Group. Managing Director Christian Mailly of Dr. Peters Group emphasized the trust placed in VAS, citing their unparalleled capabilities in dismantlement and aftermarket sales network. It’s a strategic move in response to the growing demand for quality USM parts, particularly with the resurgence in reliance on the A380.
Notably, the teardown process will be carried out at various locations, optimizing the positioning of harvested parts to cater to different markets. While some parts will be positioned in Europe to support operators in the region and the Middle East, others will remain in the Asia-Pacific region. This meticulous strategy ensures efficient access to spare parts, benefiting MROs and airlines across these markets.
The decision to retire these A380s comes at a time when operators are reassessing fleet strategies amidst evolving market dynamics. Despite initial plans for quick retirement due to the emergence of more fuel-efficient alternatives, factors such as a rebound in long-haul demand and delays in new widebody deliveries have prompted operators to reconsider. The A380, with its unique capacity and capabilities, presents a practical solution for short-term capacity management.
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