State-owned carrier Biman Bangladesh Airlines has decided to purchase ten planes from Airbus (AIR.PA) in a shift from its Boeing-dominated fleet, the South Asian country’s junior minister for civil aviation told Reuters on Monday. Mahbub Ali said the airline’s board had approved the plan at a meeting on May 3, but the deal details were still being worked out. According to local media reports, the deal will likely involve eight-passenger planes and two cargo freighters. Airbus has already sent a demonstration aircraft to Dhaka to impress the Biman board, which will be responsible for signing a memorandum of understanding with the European plane maker. The airline is believed to be negotiating at around half of the list price for the A350 widebody planes.
He said purchasing the new planes would allow Biman to open up additional routes, including long-haul flights. The airline currently operates 21 aircraft, comprising four long-range Boeing 777-300ERs and 787s, six Boeing 737s, and five Dash-8 Q400s. Ch-aviation data shows that the airline only used about 76% of its fleet capacity in the 2021-2022 fiscal year.
But experts question the plan to buy Airbus planes, saying it would cost Biman more money in the long run. The airline will also have to train pilots, cabin crew members, and engineers anew for the A350s. They say that a mixed fleet will also need clarification about what type of aircraft is being used on each flight.
Biman has been on a shopping spree since its conversion into a public limited company in 2007 and spent more than Tk 19,000 crore purchasing Boeing planes from the US manufacturer between 2011 and 2019. But they say many of the large jets are not being used to their full potential mainly because of a lack of adequate routes and poor planning and management.
The junior aviation minister said that some of the Boeing planes that Biman has purchased have been on a standby basis for years and are not being used regularly due to the shortage of passengers. He added that he wanted more from the airline’s revenue performance and asked Biman to improve it.
Airbus has been aggressively promoting its aircraft in Bangladesh to increase sales. It has a sales office in the country and is assisting with training pilots, cabin crew, and engineers for the new planes. It has also offered to help set up a maintenance facility in the country to help reduce operating costs.
The British government has signed a bilateral agreement with Bangladesh allowing the airline to access funds through the UK Export Finance scheme, which can offer discounts on aircraft purchases. The move could speed up signing a memorandum of understanding with Airbus, which has been lobbying to secure the deal. Several senior government officials were expected to visit Dhaka on Tuesday to finalize the deal’s details. Bangladesh Prime Minister Sheikh Hasina is scheduled to leave on a trip to the United Kingdom later this week.