IndiGo to take delivery of CFM engines from Aug to power A320neo planes3 min read . Updated: 27 Jul 2020, 06:57 AM IST
- New engines will power the airline’s 280 A320neo and A321neo planes
- While P&W engines are fuel-efficient, IndiGo had to ground its planes many times due to engine issues
NEW DELHI : IndiGo, India’s largest private airline, will start taking delivery of engines from CFM International from August to power its fleet of Airbus A320neo planes, said two people aware of the matter. The new engines will offer a much-needed alternative to the carrier, which faced problems with the Pratt and Whitney (P&W) engines on its A320neo planes and had to ground several flights because of these problems.
“IndiGo, which has already taken delivery of 20 A320neo family aircraft this year, will take delivery of 45 A320neo family aircraft during FY2021," said one of the two people mentioned above requesting anonymity.
IndiGo had in June last year placed a $20billion order for CFM LEAP-1A engines to power 280 A320neo and A321neo aircraft. The order includes supply of spare engines and overhaul of engines. CFM is a JV between GE Aviation, a subsidiary of US-based General Electric, and Safran Aircraft Engines, a Safran of France arm.
Engine deliveries are planned to coincide as closely as possible with the production schedule of each aircraft in order to minimize a build up of engine inventory, said an Airbus spokesperson.
" Production and delivery schedules are contractually agreed with the customer and remain confidential, so we cannot give any specifics on timings," the spokesperson added.
Spokespersons for IndiGo and CFM chose not to comment.
IndiGo, run by InterGlobe Aviation Ltd, is one of the top buyers of Airbus planes globally with a total order book of 730 A320neo planes. P&W engines at present power IndiGo’s entire fleet of Airbus A320neo family of aircraft. The carrier will receive 100 more such engines as part of its deal with P&W.
The award of the mega engine order to CFM is said to have triggered a row between warring IndiGo promoters Rahul Bhatia and Rakesh Gangwal as the decision of the IndiGo board was not supported by RG Group, the entity controlled by InterGlobe Aviation’s co-founder Gangwal, who has been managing the technical aspects of IndiGo since its inception in 2005. Gangwal and Rahul Bhatia of InterGlobe Enterprises Pvt. Ltd are involved in arbitration at the London Court of International Arbitration. P&W engines are considered more fuel-efficient than their rivals, but there have been problems with them since they entered service in 2016, forcing IndiGo to ground its planes several times. P&W claims that the issues have been resolved.
“The huge order placed with CFM by IndiGo was done considering the economic implications of the deal and IndiGo had negotiated with both P&W and CFM for the deal," said the second person cited above who also did not want to be named. “CFM bagged the deal as their offer was economically better," the person said.
IndiGo had a fleet of 262 aircraft comprising 100 A320neo, 13 A321neo, 123 A320ceo, and 25 ATRs as on 31 March 2020. Like its rivals, IndiGo has been reeling under the severe impact the coronavirus outbreak has had on the civil aviation industry and weak consumer demand.
IndiGo clocked a loss of ₹870.81 crore in the March quarter, from a year-ago profit of ₹596 crore. The airline has also announced plans to lay off a tenth of its staff, or about 2,700 people, to survive covid-led disruptions. Indian carriers are staring at a combined revenue loss of ₹1.3 trillion between fiscal 2020 and 2022 because of the pandemic, rating agency Crisil had said in a report.
IndiGo plans to replace all its older A320ceo planes from its fleet with the A320neo planes over the next two years, its CEO Ronojoy Dutta had said last month.
“We are replacing our old A-320ceos with new A-320neos to enhance cost efficiency, freezing supplementary rentals. We are in talks with suppliers to provide more favourable credit terms and we are not paying out dividends this year to ensure liquidity," Dutta had said.