Saturday, January 15, 2011

IndiGo Buy Gives Airbus A320NEO A Big Boost

Aviation Week & Space Technology Jan 17 , 2011 , p. 34
Robert Wall
Neelam Mathews
New Delhi

Printed headline: Stepping Up

IndiGo’s plan to field 150 A320 new engine option (NEO) narrowbodies is giving a big boost to the carrier’s ambitions and Airbus’s reengining program.

For Airbus, the huge 180-unit order (including 30 non-NEO A320s), is just the first step after launching the reengining effort without a traditional launch customer. But a second commitment—likely for the initial operator—is expected Jan. 17, indicates EADS CEO Louis Gallois.

Airbus will have to build regular A320s alongside the NEO just to sustain demand. All the single-aisle aircraft to be delivered under the new order—to be made firm in the next two months—will be handed over after 2015; the NEO is to enter service in early 2016. The IndiGo commitment for 30 regular A320s—featuring winglets—was necessary to meet aggressive airline growth plans, an Airbus official notes.

Still pending is IndiGo’s engine choice, pitting the CFM International Leap-X against the Pratt & Whitney PW1100G. That decision, along with the engine for the second order, should dictate which of the engine suppliers goes through the development and certification process first.

The airline’s Jan. 11 announcement is the largest single commercial aircraft order, Airbus says, valued at $15.6 billion at list price. It puts IndiGo on track to become India’s leading domestic airline.

IndiGo is planning a smooth transition from an existing order for 100 A320s, placed in 2005 even before the carrier formally existed, to the new commitment. Deliveries under the existing contract run into 2015, with the latest deal—from 2016-25—representing a mix of fleet replacements and growth. The airline will effectively be operating three types of A320s—standard issue, those with winglets, and NEOs. There is a high degree of parts commonality, so little impact on pilot training is expected, according to Airbus.

The airline now operates 34 narrowbodies, another five are due by April and nine more later in the year. By March 2012, a fleet of 52 is expected.

The fleet is powered by International Aero Engines V2500s; IndiGo was the launch customer for the Select One program.

IndiGo’s leadership—the airline is owned by InterGlobe Enterprises and Rakesh Gangwal, the former CEO of US Airways—is betting on a resurgence of air travel. But for now, one-third of its fleet is parked in New Delhi.

Now that the airline has completed five years of domestic operations, government regulations permit it to begin flying international routes by summer. An airline official says that while operations will expand beyond India’s border, the commitment to more A320s shows the focus remains on medium- and short-haul operations with stage lengths of no more than 6 hr.

For the New Delhi hub, the growth also holds promise. “We see Indigo as a key contributor to our continued success as a hub [since] New Delhi plays an integral part in [Indigo’s] growth strategy,” says an airport official.

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