Airbus set for grand Paris debut with record 500-aircraft agreement with IndiGo

Airbus SE is poised for a grand entrance at the Paris Air Show, where the European planemaker could announce a record 500-aircraft agreement with India's largest airline IndiGo on the first day, according to a report by Bloomberg.

The proposed order, which would double the airline’s existing backlog, is for A320neo family aircraft. IndiGo and Airbus are moving to announce the accord as early as Monday, said the report.

Also Read: May aviation data: Domestic air traffic jumps 36% on year; IndiGo's market share over 60%

Airbus is also working to firm up talks with Saudi carrier Flynas Co. for a large narrow-body order that could become another marquee deal of the event alongside IndiGo, according to Bloomberg. The negotiations for both the transactions could still drag out and final number might change.

Airbus Chief Executive Officer Guillaume Faury said on June 16 that the show will demonstrate how the industry is returning “back to the good old times of excitement.” Even before the event, Airbus said it struck deals for 60 A320 family aircraft and 10 A350s from undisclosed customers, setting the pace for what stands to be a few busy days of orders.

Flynas said last year that it wants to raise the volume of its orders to 250 aircraft to become the leading low-cost airline in the Middle East, said the report. The company now has a fleet of about 50 aircraft, most of which are Airbus A320s. It also has about 50 orders pending with the European manufacturer. 

IndiGo already has a backlog of about 500 planes as part of previous accord, including a 300-plane order in 2019. Also, news agency Reuters reported earlier this month that IndiGo was close to placing a record deal with Airbus. 

The airline is also working on a separate purchase of widebody aircraft, with both Airbus and Boeing Co. vying for a deal involving about 25 aircraft, said the report. Boeing may have the upper hand to secure that accord with its 787 Dreamliner, though negotiations remain in flux, added Bloomberg.

A purchase by IndiGo would top a recent agreement by Air India to buy 470 aircraft from Airbus and Boeing as the country’s former flag carrier rebuilds its operations with a modern fleet under new ownership. India is one of the fastest growing aviation markets in the world with Indigo controlling close to 60 per cent of domestic flying. 

The market share of IndiGo, rose 390 basis points in May and market share for May stood at 61.3 per cent, after rising 70 basis points in April, 90 basis points in March and 130 basis points in February. The low-cost carrier flew 81.10 lakh passengers in May.