Adani Group, Embraer's partner in a planned E175 assembly line in India, reportedly considered launching its own airline in a move that could support the local production of the Brazilian regional jet, according to The Economic Times.
The newspaper reported that Adani Airport Holdings wrote to the Airports Authority of India (AAI) requesting the removal of a concession rule that prevents the operator of Mumbai International Airport from owning more than a 10% stake in a scheduled airline. The company also asked that similar restrictions not be included in future airport concessions.
Recent news
According to The Economic Times, the letter states that Adani is "uniquely positioned to support the development of a next-generation airline" and would implement governance measures to ensure fair treatment of competing carriers.
The report emerged a day after Reuters disclosed that the conglomerate had approached the Indian government seeking changes to the ownership rules. On Friday, however, Adani Enterprises denied it was evaluating the launch of an airline, calling such reports "entirely baseless and factually incorrect" in a stock exchange filing.
The issue has drawn attention because Adani has rapidly expanded across India's aviation sector. The group operates eight airports, including Mumbai, is developing the new Navi Mumbai International Airport, owns ground handling and maintenance businesses, operates pilot training activities and, earlier this year, signed an agreement with Embraer to study the local production of the E175 regional jet.
Solving Embraer's biggest challenge in India
The Economic Times also linked the reported airline project to the Embraer partnership.
According to the outlet, existing Indian airlines have shown little interest in acquiring E175 aircraft, leading Adani to consider creating its own carrier as a way to make the manufacturing venture commercially viable.
The scenario addresses a challenge Embraer has openly acknowledged. CEO Francisco Gomes Neto has said the company would require orders for approximately 200 aircraft before investing in a final assembly line for the E175 in India.
A carrier controlled by Adani would not generate that volume on its own, but it could become the launch customer for locally assembled aircraft while introducing the type to the Indian market on a much larger scale than today.
At present, Star Air is the only Indian airline operating Embraer E-Jets. Its fleet includes eight second-hand E175s, and the carrier also plans to add two used E190s.
Neither Adani nor Embraer has suggested that an airline launch forms part of their industrial partnership.
