IndiGo places $5 billion order for 30 A350-900 widebody aircraft

To mark foray into long-haul routes, taking the fight to A-I

IndiGo on Thursday placed an order with European plane maker Airbus for 30 A350-900 widebody aircraft at a deal estimated to be between $4 billion and $5 billion.

To meet growing demand in the country’s air travel market, Indian carriers have made four significant aircraft orders since last year.
 

In February 2023, the Tata-run Air India Group placed an order for 470 planes: 250 with Airbus and 220 with American plane maker Boeing.
 

In June 2023, IndiGo made the world’s largest aircraft order by signing a deal for 500 A320neo family planes from Airbus.

In January 2024, the new airline Akasa Air placed an order for 150 B737 MAX aircraft with Boeing.
 

 

Thursday’s order marks the first time that IndiGo is purchasing widebody planes for its fleet. However, India’s largest airline does have some experience with widebody planes as it currently operates two B777 aircraft, leased from Turkish Airlines.

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“The exact configuration of the (A350-900) aircraft will be decided at a later stage, and deliveries are expected to start from 2027. In addition to the 30 firm A350-900 order, IndiGo has purchase rights for an additional 70 Airbus A350 family aircraft, at its discretion, for possible future needs under certain conditions,” the airline mentioned.

Widebody aircraft have larger fuel tanks and engines compared to narrow-body aircraft, enabling them to travel longer distances. The A350-900 aircraft, which will be powered by Rolls-Royce’s Trent XWB engine, has a range of about 15,000 kilometres. This capability means that IndiGo will be able to operate non-stop flights on long-haul and ultra-long-haul routes such as India-US, India-Australia, and India-Europe. This also positions IndiGo to directly compete with Air India and other foreign carriers such as Emirates and Qatar Airways on these lucrative routes.
 

Sources said IndiGo is expected to pay about $4-5 billion for 30 A350-900 planes. The 500 planes ordered in June 2023 are scheduled to be delivered to IndiGo between 2030 and 2035. From its previous order with Airbus, the airline is scheduled to receive deliveries of about 460 planes by 2030. Therefore, Airbus is set to deliver a total of 990 aircraft (30 + 500 + 460) to IndiGo by 2035.
 

Pieter Elbers, chief executive officer (CEO) of IndiGo, said, “Thursday’s historic moment marks a new chapter for IndiGo and will further shape the future of the airline and Indian aviation.”

He further added, “For IndiGo, after successfully pioneering the Indian skies with an unprecedented journey, its fleet of 30 Airbus A350-900 aircraft will allow IndiGo to embark on its next phase of becoming one of the leading global aviation players.”

As of February 29, IndiGo had 366 planes in its fleet. The carrier currently holds about 60 per cent share in the domestic air passenger market.

IndiGo, which is planning to become a significant player on long-haul and ultra-long-haul international routes, only has economy-class seats to date. In June 2022, then-CEO Ronojoy Dutta told Business Standard that IndiGo was looking very closely at dual-class configuration (business and economy) for the narrowbody plane A321XLR. IndiGo is expected to start receiving A321XLR planes from late 2024 onwards. It is unclear whether the A350-900 aircraft will have business-class seats.

At a Confederation of Indian Industry event on May 24 last year, Aviation Minister Jyotiraditya Scindia advised Indian carriers to prioritise expanding their international flight operations due to the tight margins in the domestic aviation market, largely driven by intense competition.

This counsel from the minister resonated well with aviation executives, who had already been actively pursuing this strategy since the lifting of pandemic-induced restrictions on the Indian aviation sector in 2022.

The impact of this strategy is evident in the growing market share of Indian carriers in the country’s international air passenger traffic.

According to aviation analytics firm Cirium, the five major Indian carriers — IndiGo, Air India, Air India Express, Vistara, and SpiceJet — accounted for 40.94 per cent of total international flights to and from India in March 2020, just before the pandemic-induced restrictions took hold. By March 2023, their combined share had risen to 46.15 per cent.

IndiGo has also articulated its current focus on implementing the ‘strategy of internationalisation’, operating from a smaller base compared to its domestic operations.

Last month, IndiGo operated about 1,392 international flights per week, marking a year-on-year (Y-o-Y) growth of 24.4 per cent. In contrast, it operated about 12,525 domestic flights per week, reflecting a Y-o-Y growth of 9.4 per cent, according to Cirium.