Military

Airbus Firms $26 Billion Order from IndiGo; Boeing Waits for SpiceJet

A320neo_Indigo
Airbus Group NV
Finalizing an order that was placed nearly a year ago, Airbus said Monday morning that India’s largest airline, budget carrier IndiGo, has confirmed its order for 250 of the company’s new A320neo planes in a deal worth more than $26 billion at list prices. It is the largest order by number of planes ever placed on Airbus.

The A320neo is Airbus’s re-engined version of its A320, a single-aisle, narrow-body passenger jet that is a direct competitor to Boeing Co.’s (NYSE: BA) venerable 737 and Boeing’s new 737 MAX.

After the IndiGo confirmation, Airbus said that it now has over 4,100 orders for the A320neo. Boeing has written 2,831 orders for its 737 MAX.

IndiGo’s current fleet consists of 97 Airbus A320-200s, so the order placed last October was no huge surprise. The airline has previously placed orders with Airbus for a total of 180 A320neo and 100 A320ceo jets. All told, IndiGo has now ordered 530 Airbus passenger jets. The airline’s goal is to build a fleet of 1,000 jets to accommodate the expected growth in India’s domestic demand for air travel.

Another Indian carrier, SpiceJet, reportedly has been talking with both Boeing and Airbus about an order for more than 100 new single-aisle planes that could be worth more than $11 billion at list prices. In this competition, Boeing may have the upper hand, as SpiceJet’s current fleet of 35 planes includes 20 Boeing 737s and just one Airbus A319. The SpiceJet order comes less than a year after SpiceJet nearly shut down before being bailed out by the airline’s founder and current chairman, Ajay Singh.

SpiceJet ordered 42 of Boeing’s yet-to-be-delivered 737 MAX airplanes in October 2013, bringing the total number of Boeing planes ordered by the airline to 74. The remaining 32 planes have all been delivered, although some have been sold to other carriers.

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