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02:52 - Source: CNN
New York CNN  — 

Boeing announced one of the largest orders in its history Tuesday. But it was still topped by rival Airbus.

Both aircraft makers announced massive orders from Air India, which is gearing up its own expansion plans.

Boeing’s order, which was announced by President Joe Biden after a call with Indian Prime Minister Narendra Modi, was for 220 firm jet orders: 190 of Boeing 737 Max single-aisle planes, 20 of 787 Dreamliners widebodies and 10 of 777X, the newest version of its widebody now undergoing the certification process.

It’s the third biggest sale of all time for Boeing.

But Airbus announced orders for 250 jets, including 140 A320neo and 70 A321neo single-aisle planes, along with 34 A350-1000 and six A350-900 widebodies.

It’s a sign of the competitive disadvantage that Boeing still finds itself facing, especially in selling narrow-body, single-aisle jets, a segment of the market that Airbus continues to dominate.

Boeing has been narrowing the gap with Airbus in orders, helped especially by an even larger order from United late last year. For all of 2022, Boeing announced a total of 808 net commercial aircraft orders, up from 535 a year earlier. But Airbus edged it out with 820 orders.

Boeing has had a particularly hard couple of years. It experienced a 20-month grounding of its best-selling 737 Max following two fatal crashes, with rising trade tensions between China and the United States leading to a virtual halt in sales to China, the world’s largest market for plane sales, and of course the pandemic.

But even in 2018, when Boeing reported record sales revenue, it trailed Airbus by about 200 net jet orders for the year.

Outlook for aircraft orders improving

The good news for Boeing is that aircraft manufacturing is essentially split between the two companies, and there’s a long backlog of orders at both. Boeing had a backlog of nearly 4,600 jets on its books at the end of January.

And as the Air India order demonstrates, global airlines are starting to gear up to make new purchases as they climb out of years of losses caused by the plunge in demand during the pandemic.

Global air traffic is expected to boom this year, returning to pre-pandemic levels in June, according to a new report from aircraft leasing company Avolon.

And the global airline industry is expected to return to profitability this year for the first time since 2019, according to the International Air Transport Association. The US industry already returned to profitability in 2022.

Boeing’s Air India order was valued at a list price of $34 billion. Airbus no longer publishes a list price for its aircraft, but its most recent list price from 2018 would have valued its Air India order at nearly $38 billion.

Airlines do not pay full list prices for commercial jets, especially when placing an order this large. But even at a discount of 50%, which is not unusual, Boeing’s Air India order would mean a sale valued at $17 billion.

That’s an important lift to a company still struggling to recover from the plunge in revenue and financial losses it suffered over the last four years.

Boeing’s 2022 revenue came in at $66.6 billion, up $8 billion from the trough in sales in 2020, but far lower than its record 2018 revenue of $101 billion before the grounding. Boeing gets most of its sales revenue once a plane is delivered, and the 777X has yet to be built. The planes in this order are years away from delivery.

The Air India purchase also includes an option that allows it to buy an additional 50 Boeing 737 Max’s and 20 Boeing 787s, totaling 290 airplanes. At list price, that order would be valued at $45.9 billion.

Biden touts order

In a statement, Biden said the sale would “support over one million American jobs across 44 states, and many will not require a four-year college degree.”

“This announcement also reflects the strength of the U.S.-India economic partnership,” Biden wrote. “Together with Prime Minister Modi, I look forward to deepening our partnership even further as we continue to confront shared global challenges — creating a more secure and prosperous future for all of our citizens.”

Production will support three separate U.S.-based manufacturing lines, have a total economic impact of $70 billion across the United States and support an estimated 1.47 million direct and indirect jobs, a White House official said Tuesday.

India’s growing economic might

India has been gaining some manufacturing business as Western