IndiGo, a longtime Airbus customer, is now adding Boeing planes
- The Indian market has been facing a shortage of aircraft for a while. SpiceJet and IndiGo have relied on wet-leased aircraft periodically, while Air India and Akasa Air have stayed away. For IndiGo, it is a measure to add capacity and take on competition with a strong balance sheet to back it.
Surprising as it may sound, the airline with the largest order book with Airbus is inducting more Boeing 737 MAX 8 aircraft into its fleet, albeit on wet-lease. IndiGo has started receiving aircraft from Turkish carrier Corendon Airlines; the first two landed on Sunday, and a few more are expected to follow later this month. The aircraft landed in Delhi from Antalya. Both the aircraft are MAX 8. Corendon is not new to Indian skies, with the airline being a regular operator, thanks largely to SpiceJet which has had Corendon aircraft multiple times in the past and at regular intervals. Corendon Airlines is a Turkish operator with sister airlines registered in the Netherlands and Malta.
November has been a bumper month for Indian aviation. The month recorded the highest-ever traffic in the history of domestic aviation in India. IndiGo, too, benefitted from the same, and the airline carried over 10 million passengers in a single month for the first time in its over 18-year history. The airline is battling a sudden surge in competition, especially from Air India Express — the low-cost subsidiary of Air India. As the delays from Boeing impact the fleet expansion of Akasa Air and Air India Express, the latter has the benefit of having the Air India mothership. It has seen the transfer of routes from the mainline carrier and also the transfer of aircraft from Air India to Air India Express.
With a cost structure lower than Air India and a low-cost offering to take on IndiGo, Air India Express has been mounting flights to hitherto monopoly destinations of IndiGo, amongst others. Additionally, the flights which saw replacement from Air India or Vistara to Air India Express have the ability to put pressure on yields for IndiGo since Air India Express can compete with IndiGo on pricing, unlike mainline Air India, which has higher input cost, largely due to its legacy operations.
With over 50 planes still grounded due to Pratt & Whitney engine issues, IndiGo is constrained to take on the competition by adding flights, which it has traditionally done. The airline already has two B777s from Turkish Airlines, which operate to Istanbul from Delhi and Mumbai, and six MAX 8s from Qatar Airways, which operate to Doha.
Also Read: ‘No delays here!’ — IndiGo hits back at AirHelp for ranking it among world’s worst airlines
Confusion for passengers?
IndiGo’s first brush with wet-lease operations was in 2017 when it inducted four aircraft from Lithuanian carrier Small Planet Airlines. The need then was the lack of timely delivery of Pratt & Whitney-powered A320neo. Eight years later, the Pratt & Whitney angle remains the same, though this time around, the planes are grounded.
In 2017, the aircraft were similar in configuration and type to the aircraft which IndiGo operated. It is not the case now, with the MAX 8 having 189 seats, not having a row 13 and more, unlike IndiGo’s 186 or 180 seats configured A320/A320neo. The existing wet-leased operations are to Doha, which are handled at the international terminal while the new ones will ply on domestic routes, with the potential to create confusion and the need to train the staff — adding costs, even though marginally.
For an airline as brand-conscious as IndiGo, the benefits of adding planes clearly outweigh the brand image, confusion, and impact.
Taking away aircraft from the market?
The Indian market has been facing a shortage of aircraft for a while now. Carriers like SpiceJet and IndiGo have relied on wet-leased aircraft periodically, while Air India group and Akasa Air have remained away. For IndiGo, it is a measure to add capacity and take on competition with a strong balance sheet to back it. Besides, with the planes grounded, these wet-lease costs can be used effectively for bargains and negotiations on compensation. SpiceJet, on the other hand, has little choice and relies on this method to add capacity.
By adding more planes, IndiGo is also taking away capacity, which could have otherwise gone to other players in the same market.
Also Read: Could softening demand spoil the IndiGo party?
Tail Note
The airline will declare its Q3-FY25 results by mid-February and we will know if it was worth inducting as many wet-lease aircraft and how much money it actually generated. All numbers indicate that the airline will definitely record a profit. Will it be a bumper ₹3,000-crore profit as has been the case in the past?
The wet-leased B777s are in IndiGo livery while the Qatar Airways MAX 8 sport a decal and not a change in livery. A change of livery is usually an indication of the planes being here for a longer term, otherwise it does not make financial sense. Will these aircraft be short term or long term? Will this be the first Boeing narrowbody in IndiGo colours?
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First Published:9 Dec 2024, 03:53 PM IST
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