IndiGo places purchase order for 250 A-320 neo planes with Airbus -Governance Now

IndiGo places purchase order for 250 A-320 neo planes with Airbus

Order, worth nearly $26 billion, is the largest single order for jets from the European planemaker

Sweta Ranjan | October 16, 2014

In order to cement the top position, budget airline IndiGo on Wednesday placed a purchase order for 250 A320 neos planes from Airbus. The order, worth nearly $ 26 billion, is the largest single order for jets from the European planemaker.

IndiGo plans to expand aggressively with more market share. Country’s only profit making carrier will start taking delivery of planes from 2018. The company has also secured the rights to buy 100 A320.

One of the top officials of Indigo said IndiGo is aiming to list on the Indian stock exchange in 2015. IndiGo currently has a fleet of 83 Airbus 320.

Seeming unperturbed with the entry of new players such as Air Asia and Vistara, IndiGo has taken this bold step to further enhance its network. While other low cost carriers such as SpiceJet is opting for cutting down the size of their fleet IndiGo is eyeing to grow by more than 75 percent in the next six years.

IndiGo, India’s biggest airline by market share, is the only no-frill airline to post six straight years of profit. An aviation analyst says: “This order is further going to give tough time to other LCC. It is the right strategy of the company that has kept the company going even when the other carriers are crying against high fuel taxes."

Analysts visualise the deal as a strong indicator for long term potential of the Indian civil-aviation market.

The A320 neo (new engine option) offers better efficiency with improvement results in 20 percent fuel saving per seat along with two tones more payload, up to 500 nautical miles additional range, lower operating costs and reduction in engine noise and emissions.

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