Pieter Elbers, the chief executive officer of IndiGo, on June 19 said that the airline's record order with European manufacturer Airbus for 500 A320 Family aircraft will give the budget carrier ample time to plan out its future.
"The new order speaks about the growth potential that Indian aviation holds, it gives IndiGo time to elaborately plan our domestic, and international network and also our pilot requirements going forward," Elbers said while speaking to the media through an online press conference.
He added that IndiGo will look to double its current fleet by 2030 and has plenty of time and flexibility to decide on the specific aircraft to buy under the current order of 500 planes.
"We should not confuse short-term challenges with long-term opportunities. India has an enormous young population and large aircraft orders like ours give them a career opportunity... This order gives us the flexibility to elaborately plan our pilot training programs, as they take time and be prepared for the future," Elbers said.
The executive was speaking to the media, after IndiGo announced the biggest single-purchase agreement in the history of commercial aviation of 500 A320 Family aircraft.
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The deal is worth $50 billion at list prices and the airline will take delivery of these new aircraft between 2030 and 2035. However, the actual cost of acquisition is expected to be significantly lower as such big deals happen at a substantial discount to list prices.
This IndiGo order comprises a mix of A320 neo, A321 neo and A321 xlr aircraft. The airline will take the delivery of these aircraft between 2030 and 2035.
Elbers added that IndiGo has plenty of time to evaluate the modalities of financing the new order for 500 planes.
"IndiGo has a proven track record of financing, so we are not worried about financing," Elbers said.
The new order takes the total number of Airbus aircraft on order by IndiGo to 1,330, making it the world’s biggest customer of A320 aircraft.
The purchase agreement was signed by Rahul Bhatia, Promoter & Managing Director of IndiGo, Dr Venkataramani Sumantran, Chairman and Non-Executive Independent Director of IndiGo, Pieter Elbers, CEO of IndiGo, Guillaume Faury, Airbus CEO, and Christian Scherer, Airbus Chief Commercial Officer and Head of International, at the Paris Air Show 2023.
"In all likelihood, we might not see a total of 500 aircraft being deployed into revenue service in India, effective deployment of fleet will remain at the 300 to 350 level with the remaining aircraft on order being structured as part of fleet replacement cycle every 7 or 10 years," said Mark M Martin, CEO of Martin Consulting.
With a commanding 61 percent share of the domestic Indian market, IndiGo is likely to reign tall over the Indian aviation market for the foreseeable future.
“The fact that India now has two well-capitalised carriers that have the ability and willingness to take significant bets on the potential of this market, augurs well for the stable, long-term growth of Indian aviation,” said Kapil Kaul, CEO & Director, CAPA India.
Currently, IndiGo operates flights to 26 international destinations, serving 75 international city pairs. The airline aims to bolster its international seat share from 23 percent in 2023-24 to 30 percent within the next two years, according to Elbers.
With its fleet of over 300 aircraft, the airline is operating well over 1,800 daily flights connecting 78 domestic destinations.
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