In the largest aircraft purchase ever, Indian low-cost carrier IndiGo bought 500 narrow-body aircraft from Airbus on Monday, shattering the previous record held by Tata Group’s Air India.
According to a statement from IndiGo, the new aircraft will be delivered between 2030 and 2035. IndiGo also stated that it expects to get 480 already purchased aircraft from the French manufacturer by the end of the decade. 300 Airbus planes are now flown by IndiGo.
Pieter Elbers, CEO of IndiGo, said in a statement: “It is difficult to overstate the significance of IndiGo’s new historic order for 500 Airbus A320 family aircraft.” “An order book now of almost 1,000 aircraft well into the next decade enables IndiGo to [fulfil] its mission to continue to boost economic growth, social cohesion, and mobility in India.”
In anticipation of a travel boom, competition in India’s aviation industry is escalating, which is why IndiGo placed its multibillion-dollar purchase for the new jets.
In February, Air India placed orders with Boeing and Airbus for 470 aircraft, including 70 wide-body models for long-distance international flights. Compatriot Akasa Air announced that it would add fresh aircraft orders into the “three digits” to an existing order for 72 aircraft from Boeing. Akasa Air began operations in August and will launch international routes this year.
By the end of the decade, the South Asian country will overtake China as the world’s most populous nation and move up to third place in terms of GDP. India’s domestic airline traffic is expected to increase 20% to 160 million passengers in the year ending March 2024, according to aviation consultancy CAPA — Centre for Aviation, while international travel may increase 27% to 75 million.
In response, the Indian government has allocated $11.8 billion for the development and modernisation of airports. By 2025, it wants to double the number of airports nationwide to 220 from 140.
Elbers, who joined IndiGo after almost eight years as the CEO of the Dutch airline KLM, stated in an interview with Nikkei Asia in April that he is giving global expansion first priority. In addition, IndiGo would “develop the domestic network, which remains the core of the company,” with the aim of “serving every city which has an airport of some size,” he stated.
In 2022, the airline, which has flights to 78 Indian destinations, carried 69 million passengers domestically. According to India’s civil aviation regulator, its domestic market share was 61.4% in May, more than twice that of Air India, its nearest domestic rival. In contrast to Air India’s 10.67 million international passengers, IndiGo handled 7.42 million last year.
Founded in 2006, IndiGo has succeeded in a competitive domestic market. In the past three decades, at least 15 Indian airlines, including well-known names like Jet Airways and Kingfisher Airlines, have shut down due to pricing wars, low passenger loads, and the high cost of fuel. Budget airline Go First filed for bankruptcy protection in May, blaming its financial difficulties on Pratt & Whitney engines that were unreliable and forced it to halt almost half of its fleet.
