India’s Star Air considering $1 billion Embraer jet purchase

Star Air is the largest regional carrier in India and carried 0.5% of India’s domestic traffic during the month of October.

Star Air, India’s largest regional carrier, is considering the purchase of as many as 20 Embraer SA aircraft, according to people familiar with the matter, in what would be a breakthrough for the Brazilian manufacturer in one of the fastest-growing aviation markets.

The deal for the Embraer E2 jets has a value of about $1 billion, based on the list price of these planes, and the deliveries are likely to start from the year ending March 2028, said the people, asking not to be identified as the talks are not public. An agreement would likely comprise 10 firm orders and 10 options, which can be exercised at a later stage, they added.

The purchase would mark the first by the airline that’s owned by the Sanjay Ghodawat Group, which has interests in areas spanning consumer products, education, retail and mining.

Discussions are still underway on the aircraft order and there is no assurance a deal will be reached, some of the people said.

Embraer inaugurated its India office in New Delhi this October, underscoring the Brazilian manufacturer’s ambitions in the market. Star Air already has a small fleet of leased Embraer E145 and larger E175 aircraft, and would continue to operate those planes until the new jets arrive, the people said.

Star Air is the largest regional carrier in India and carried 0.5% of India’s domestic traffic during the month of October. Government-owned Alliance Air had a 0.2% market share and operates a fleet of 20 ATR aircraft and one HAL Dornier aircraft.

Star Air said in an email that the airline continues to evaluate opportunities to expand and upgrade its fleet. A representative for Embraer declined to comment.

Star Air’s order, though small, would be the first by a regional carrier and will help the airline take advantage of India’s target to increase the total number of airports to 400 by 2047 from 160 now. India is also working on a plan to expand regional connectivity to include airports that have infrastructure but no flights.

India’s aviation market has become the third largest domestic market after the US and China.