Dubai: Even with a 60 per cent plus share of India’s domestic aviation market, IndiGo is in no mood to go easy with its international expansion push.
With an order book of nearly 1,000 aircraft, there is really no reason for IndiGo to slow down, whether in its domestic operations or overseas.
The airline is set to receive 50 aircraft over the next year, and “if you actually think about it, this amounts to one plane every week,” said Pieter Elbers, CEO. “This allows us to adapt our capacity to match demand in a high-growth market.”
The airline has grown its list of destinations from 100 to more than 115, with three more on the horizon – Bali, Medina, and Ayodhyas. When asked if rival budget carrier Go First’s bankruptcy had anything to with its exponential growth of the past year, Elbers said, “The competitive landscape of the Indian aviation sector is evolving, and as the market leaders, we are taking steps to strengthen our position.”
IndiGo’s grand growth plans for its overseas ambitions places the UAE and Gulf operations right in the center. Elbers said the UAE is an integral part of IndiGo’s traffic and plans are in place to expand services into Saudi Arabia.
“We are reviewing our bilateral agreements in Saudi Arabia,” the CEO added.
The airline recently introduced new flight routes connecting Ahmedabad to Jeddah, expanding its services beyond Delhi and Mumbai. “When the airline went international for the first time, it was a classical India-UAE type of destination being added. At present, we fly to 11 destinations in the Middle East,” he said.
Mitigation measures
The airline is also standing firm by its capacity growth forecasts for the year, even as it expects to ground more than 30 planes in the fourth quarter due to issues related to its Pratt and Whitney engines. It has grown its capacity by 25 per cent in the last few quarters, and that has helped mitigate the grounding of planes, including about 40 older aircraft.
The mitigation measures also include leasing new planes.
IndiGo, which operated 334 planes as of September 30, has retained 14 of its older Airbus A320ceo, extended leases on 36 other aircraft, and taking 11 additional aircraft on lease starting November. It is also leasing 12 more A320ceos from the secondary market starting January.
“Our strategy involves a combination of lease extensions, fleet retention, and short-term leases,” said Elbers. “We remain open to securing more leases in the coming months as the situation evolves.”
The airline also introduced a fuel charge to counter rising air turbine fuel (ATF) charges. Elbers said this has not impacted demand and said, “We are continuously monitoring the geopolitical situation and the dynamics of the global oil market and adapt strategy as required.”
A ‘global airline’
Elbers said there is potential for growth to many other destinations. In the last quarter, IndiGo added six destinations, such as Almaty, Tbilisi, Tashkent, Baku, Nairobi, and Jakarta, taking the airline to destinations ‘Indians have never seen before’.
“We now operate to Central Asia, and we operate seven destinations out of India into Singapore. When we get the Airbus 321 XLR (as part of the fleet expansion) somewhere in 2024 or early 2025, those will have a range that will take us into parts of Europe.
“We could fly to Athens, Rome, Seoul, Chennai into Southeast Asia and Australia, for example.”
