IndiGo likely to induct a few B737 Max aircraft for the first time

Wet leasing Max planes being considered as about 20% fleet is grounded due to Pratt and Whitney engine issues

IndiGo is likely to induct a few B737 MAX planes for the first time, as more than one-fifth of its fleet is grounded due to Pratt & Whitney (PW) engine issues, aviation industry sources said on Sunday.

The MAX planes are likely to be ‘wet leased’ from Qatar Airways and they could be used to operate flights between India and Doha, they added. In a wet lease, the lessor provides not only the aircraft but also additional services such as cabin crew and maintenance. IndiGo and Qatar Airways did not immediately respond to Business Standard’s queries on this matter.

As of December 31, 2023, IndiGo has a fleet of 358 aircraft, comprising 312 Airbus A320 family planes, 44 ATR aircraft, and two B777 planes. The two B777s are currently under a wet lease agreement with Turkish Airlines. The B777 and B737 Max are from Boeing, a direct competitor of Airbus. In India, Air India, SpiceJet, and Akasa Air operate B737 MAX aircraft in their fleet.

While announcing the results of the third quarter of financial year 2023-24 (Q3FY24) last Friday, IndiGo’s chief financial officer Gaurav Negi informed that about 75 planes are currently grounded due to PW engine issues. “We are working with PW on spare engine availability and are hopeful that the situation will start to improve in a few quarters,” he noted.

Negi had, on Friday, said that the proactive mitigation measures -- which include retention and extension of leases of existing aircraft and procurement of additional aircraft as “damp (wet) and secondary dry leases” taken by IndiGo will allow the airline to navigate this situation in “a desired manner and grow capacity in the next financial year”. In September 2023, IndiGo had received permission from the Directorate General of Civil Aviation (DGCA) to wet lease 11 A320 family aircraft. 

In July, PW disclosed that a condition in the powdered metal used for certain engine parts necessitated an accelerated fleet inspection. Consequently, IndiGo, in November, declared its decision to ground approximately 35 planes in the fourth quarter of 2023-24, pending inspections by PW. This action adds to the existing situation for IndiGo, as even before the powder metal issue arose, its approximately 40 planes were already grounded due to an old issue in PW engines' geared turbofans.

In Q3, IndiGo reported a consolidated net profit of ~2,998.1 crore, more than double the earnings from the same period the previous year, attributed to heightened demand during the peak travel season.