IndiGo orders 500 Airbus A320 family aircraft worth $50 billion

KATHMANDU: IndiGo co-founder Rahul Bhatia on Monday made history by placing the largest order ever by an Indian airline — for 500 Airbus A320 family single aisle aircraft — at the Paris Air Show where exactly 18 years ago he had ordered the airline’s first 100 A320s.

Worth almost $50 billion at list price, though IndiGo would have got a hefty discount thanks to the scale and the airline’s impeccable credentials, the latest order is also the largest-ever single aircraft purchase by any airline globally with Airbus.

India’s largest budget airline has 480 planes yet to be delivered from previous orders which will be delivered end of this decade. The latest order for another 500 on top of them “will provide a further steady stream of deliveries between 2030 and 2035,” says the airline.

The “historic” purchase agreement was signed by an IndiGo team led by promoter & MD Rahul Bhatia with Airbus brass led by CEO Guillaume Faury at the ongoing Paris Air Show 2023. It eclipses Air India’s recent order for 470 aircraft, including 70 twin aisles, worth $70 billion in terms of number of planes.

Since its inception in 2006, IndiGo has so far ordered a total of 1,330 Airbus aircraft. Currently operating nearly 310 aircraft and enjoying over 60% domestic market share, IndiGo CEO Pieter Elbers says the airline will double its fleet size by 2030.

Its large orders (see box) help it have a young fleet of fuel-efficient planes through continuous replacements alongside fleet augmentation, a process slowed by current supply chain constraints.

IndiGo’s order book, comprising a mix of A320neo (new engine option), A321neo and A321XLRs (extra long range), has almost 1,000 aircraft yet to be delivered well into the next decade.

“Placing an order so well in advance gives us the flexibility to decide between the mix of A320/321neo and A321XLRs as we approach the end of this decade depending on the demand then. It also helps us prepare for the fleet augmentation in all terms, including pilots,” Elbers said.

Air India had this February ordered 470 aircraft from Boeing and Airbus with 400 single aisles and 70 wide bodies including A350s, Boeing 787s and B777X valued at $70 billion at list price.

IndiGo’s current order book is for all single aisles and the airline has kept the option for having wide bodies in its fleet open. It has wet leased (hired with operating crew) two wide bodies of Turkish Airlines which are deployed on Delhi-Istanbul and Mumbai-Istanbul routes.

IndiGo will decide the engines — with Pratt & Whitney & CFM being the two options — “in due course” along with the “exact mix of A320 and A321 aircraft.” Boeing had also made a strong pitch for its single aisle B737MAX.

“The fuel-efficient A320neo family aircraft will allow IndiGo to maintain its strong focus on lowering operating costs and delivering fuel efficiency… This year IndiGo expects to welcome 10 crore customers on board… IndiGo is amongst the fastest growing airlines in the world and this order will allow it to continue this growth for many years to come,” the airline said in a statement.

Elbers said: “It is difficult to overstate the significance of IndiGo’s new historic order for 500 Airbus A320 Family aircraft. An orderbook now of almost 1,000 aircraft well into the next decade, enables IndiGo to fulfill its mission to continue to boost economic growth, social cohesion and mobility in India. At IndiGo, we take pride in being India’s preferred airline for connectivity in and with India; and by doing so, being one of the leading airlines in the world.” TimesofIndia

Fiscal Nepal |
Tuesday June 20, 2023, 12:42:40 PM |

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