New Delhi: Airbus SE isn’t delivering planes fast enough.
That’s the verdict of Indian budget carrier IndiGo, the biggest customer for Airbus’s best-selling A320neo jets. Delay in getting planes on time is forcing the airline, operated by InterGlobe Aviation Ltd., to slow down the pace of expansion, executives said.
“The issue is on the supply side,” Chief Executive Officer Ronojoy Dutta said on a conference call with investors on Thursday, while answering a question on replacing older jets. “The reason why we are not growing fast enough is because we are not getting airplanes fast enough from Airbus.”
IndiGo, which has ordered 430 A320neo jets on top of 100 for the older version of the aircraft, is embarking on an ambitious expansion plan, especially in international markets, seeking to eventually connect cities such as London with New Delhi. The airline, Asia’s largest budget carrier by market value, controls almost half of the domestic market, and is in talks with the European planemaker for another large order.
IndiGo won’t keep adding six planes a month as it was doing earlier partly because Airbus deliveries are delayed by about 3-4 months, Chief Operating Officer Wolfgang Prock-Schauer said on the same call.
Delivery schedules are determined in discussions with customers and were confidential, Airbus said in an email.
Earlier on Thursday, IndiGo said it now expects to expand capacity by 25% for the year ending March 31, compared with a an estimate of 30% it made in July. The airline, founded by billionaires Rahul Bhatia and Rakesh Gangwal, also posted its biggest-ever quarterly loss amid fierce competition in India, illustrating how even the country’s biggest airline isn’t immune to challenges in one of the world’s fastest-growing aviation markets. -Bloomberg