IndiGo places largest-ever order in aviation history, inks pact for 500 Airbus A320neo family planes

IndiGo on Monday announced a mega aircraft order for 500 Airbus A320neo family planes, the largest-ever order placed by an airline in one go anywhere in the world. With this order, India’s largest airline has dwarfed Air India’s February order for 470 Airbus and Boeing planes. The purchase agreement for the aircraft was signed on Monday at the Paris Air Show.

“This will provide IndiGo a further steady stream of deliveries between 2030 and 2035… The engine selection for this order will be done in due course and so will be the exact mix of A320 and A321 aircraft,” the carrier said in a statement. While IndiGo did not announce the order value, industry insiders are pegging it at well over $50 billion based on list price assessments. However, it is worth noting that large aircraft orders usually include substantial discounts to list prices.

Today we have set another truly momentous and very exciting step in the journey of IndiGo as we placed a firm order for 500 Airbus of the A320 Family. This is the largest-ever single aircraft purchase by any airline with @Airbus. #goIndiGo pic.twitter.com/8ix3TSivIT

— IndiGo (@IndiGo6E) June 19, 2023

The no-frills carrier currently operates over 300 aircraft and has previous orders totaling 480 aircraft, which are to be delivered by 2030. With this additional firm order of 500 aircraft, the airline expects to take delivery of close to thousand aircraft over the next 12 years. This IndiGo order book comprises a mix of A320neo, A321neo and A321XLR aircraft.

The airline is looking to double its fleet size by the end of the decade and the 480 planes that are to be delivered by 2030 will be used to that end. Some of those aircraft will be used to replace older planes while the others will be used for growing the fleet, IndiGo’s Chief Executive Officer Pieter Elbers said on a call with journalists. However, he declined to give any projection about the airline’s fleet size in 2035, when the 500 planes ordered today would have been delivered.

IndiGo has big plans to further expand its network and capacity within India and internationally. With its fleet of over 300 planes, the airline currently operates over 1,800 daily flights, connecting 78 domestic airports and a few overseas destinations as well. The carrier has the largest fleet among all Indian airlines and has a domestic market share (by passengers ferried) of over 60 per cent.

Responding to a question on how the airline plans to pay for the aircraft ordered today, the IndiGo CEO said that the carrier has “a lot of time” to work that out. “Clearly Indigo has a proven model in terms of financials. We still have time, plenty of time to evaluate all options and modalities on the financial part going forward,” Elbers said.

The A320 aircraft family is the flagship range of single-aisle planes by Airbus. Except for around 40 turboprop planes that IndiGo uses for its regional flights, the carrier’s entire single-aisle fleet of jets is made up of A320 family aircraft.

“The fuel-efficient A320neo Family aircraft will allow IndiGo to maintain its strong focus on lowering operating costs and delivering fuel efficiency with high standards of reliability,” the airline said, adding that it is one of the fastest growing carriers globally and the latest aircraft order will facilitate its growth for “many years to come”.

On being asked about the timing of the order, considering 480 planes are yet to be delivered to IndiGo, Elbers said that the airline is following its track record of placing orders well in advance, which allows the carrier to plan for the long term. “This order is…basically securing IndiGo for the next 10 years. And aviation probably more than any other business is a long-term business… (the order) is aligned with the vision of the Indian government to build India into an aviation powerhouse and develop global hubs. This will enable us for long-term planning and long-term building of our network,” Elbers said.

.@Indigo6E & Airbus making history at #ParisAirShow with a deal for 500 #A320neo Family aircraft. The biggest single purchase agreement in the history of commercial aviation will contribute to democratising affordable & efficient air travel in India. https://t.co/0vbRdZ8kQS pic.twitter.com/m7goSdOhoQ

— Airbus Newsroom (@AirbusPRESS) June 19, 2023

“We basically now have a planning horizon of over 10 years, which means all the discussions and all the planning we have to do in terms of crewing, in terms of facilities, in terms of designing the network, partnerships, and so on, we can really work on the long-term vision,” he added.

While the A320neo aircraft are likely to be deployed on domestic routes and short hops to neighbouring countries, the A321s, particularly the A321XLRs, are expected to be deployed for farther overseas destinations, like those in Europe. IndiGo has plans to substantially expand its international network in the coming years. As per information available on the Airbus website, the A320neo has a flying range of 3,400 nautical miles, while A321neo’s range is 4,000 nautical miles. The flying range of an A321XLR is 4,700 nautical miles, which means it can fly non-stop for 11 hours.

On the likely mix of aircraft in the new order, Elbers declined to give numbers, but said that it would be a mix of A320neo, A321neo, and “maybe even some” A321XLR planes. “We still have plenty of time to optimise what’s going to be the precise mixture of 320 and 321s and possibly extra-large (A321XLRs) we have all this flexibility as part of this order,” he said.

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“With IndiGo’s current fleet and the almost 1,000 aircraft yet to be delivered, IndiGo is not only well positioned to expand and densify its unparalleled network but equally importantly, IndiGo will execute its role in fully supporting fulfilling this mission (of developing India into a global aviation hub),” the airline said in the statement.