Kingfisher in $1 bn deal with Airbus for 5 jets

The planes will be delivered in 2008 through a fully vendor-financed deal.

Kingfisher Airlines signed a deal with Airbus to buy five 340-500 passenger planes worth $1 billion for non-stop flights to the US at the Hannover fair today.

The airlines is expecting the government to shorten the waiting period for new domestic airlines to start international operations. The planes will be delivered in 2008 through a fully vendor-financed deal.

"Once the planes are received in 2008, we will fly the world's longest non-stop flight, direct from Bangalore to San Francisco. Another flight will go from Mumbai to New York direct. These long-range four-engine planes will seat around 225 people," Kingfisher Airlines Chairman and Managing Director Vijay Mallya said.

Currently, an airline needs at least five years of continuous operation and a fleet of 20 aircraft to start flying on international routes.

As a result, only Jet Airways and Air Sahara among Indian carriers can fly abroad. However, the government is considering a proposal to allow airlines with less than five years of flying experience in the domestic market to operate on international routes. Kingfisher started operations last year.

If the government waters down its current norms, it will throw open lucrative international routes to domestic carriers such as Kingfisher, SpiceJet and Air Deccan, which have been operating domestic routes for some time now.

Kingfisher has been working towards the possibility of flying to the US for a while. Last year, it set up an airline in the US to connect American cities with those in India. Mallya has been one of the strongest supporters of opening up international routes to newer airlines.

Mallya's steps in this direction have been opposed by the older domestic carriers.