IndiGo places record 500 aircraft order with Airbus

InterGlobe Aviation Ltd, which runs IndiGo airlines, has placed an order for 500 aircraft with Airbus, making it the single-largest purchase ever made by any airline with Airbus.

The newly ordered aircraft will be delivered between 2030 and 2035, ensuring a continuous stream of deliveries for IndiGo’s operations. The financial details were not disclosed.

The specific mix of the narrow-bodied A320 and A321 aircraft and engine selection will be determined later.

IndiGo has an operational fleet of about 300 aircraft, and had earlier placed orders for 480 planes including A320NEO, A321NEO, and A321XLR, all to be delivered by the end of the decade. With the latest Airbus deal, the airline’s order book will now consist of nearly 1,000 aircraft yet to be delivered.

The airline said in a release that the new order strengthens its “strategic relationship with Airbus and brings the total aircraft orders with Airbus to 1,330 ever since it began operations in 2006”.

The fuel-efficient A320NEO family aircraft will enable IndiGo to focus on lowering operating costs, fuel efficiency, and reliability, it added.

IndiGo said it expects to serve a total of 100 million customers this year.

The purchase agreement was signed on June 19 at the Paris Air Show, attended by key figures from IndiGo and Airbus.

Pieter Elbers, chief executive officer of IndiGo, said the order “enables the airline to fulfill its mission of boosting economic growth, social cohesion, and mobility in India”.

“It is difficult to overstate the significance of IndiGo’s new historic order,” Elbers said. “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. This order strongly reaffirms IndiGo’s belief in the growth of India, in the A320 family, and in our strategic partnership with Airbus.”

 Expanding order book

Indian airlines are witnessing a significant surge in their aircraft order books.

This trend continues just five months after Air India, owned by the Tata group, placed a substantial order for 470 aircraft from Airbus and Boeing.

Of these, Airbus will supply 250 planes, while Boeing will provide 220 planes, including 70 wide-body aircraft.

Meanwhile, other airlines have also been expanding their fleets. Despite facing difficulties, Go First, which has been grounded since May 3, has recently placed orders for 72 aircraft.

Akasa Air CEO Vinay Dube has announced plans for a “triple-digit order” of narrow-body planes, in line with the airline’s expansion strategy. The airline, which began operations in August last year, currently operates 19 aircraft, with the 20th plane scheduled to join next month.

There are about 700 domestic commercial aircraft currently operating in India, and Indian airlines have more than 1,600 planes on order.

With growing orders for narrow-body jets from India, Airbus CEO Guillaume Faury said it is premature to start thinking about production rates higher than the planned 75 aircraft per month.

Industry experts have predicted a robust demand for aircraft in the Indian market. Aviation consultancy Centre for Aviation (CAPA) said Indian airlines are likely to place orders for a staggering 1,500 to 1,700 planes within the next one to two years, reflecting the industry’s confidence and growth prospects.

According to a June 1 report by Barclays, India has become a focal market for the global aerospace and defense industry, experiencing one of the highest traffic growth rates worldwide. The country has solidified its position as the world’s most significant new aircraft market. Currently, India ranks third globally in terms of domestic air traffic, trailing only behind the United States and China.

Barclays said the growing middle-class population, coupled with an increased inclination to travel, stimulated by the government’s UDAN Regional Connectivity Scheme, has positioned India as a key source of demand for new aircraft.

Indian carriers now hold the second-largest order book, representing over 6% of the industry’s backlog, surpassed only by the US. Experts predict that this proportion will continue to rise over time due to the projected annual traffic growth remaining 200 basis points above the long-term global average.