Friday, October 17, 2014

IndiGo's aircraft deal is a great boost for the image of Indian business houses globally

Low-cost domestic carrier IndiGo has placed what is being billed as one of the top five aircraft purchase deals in aviation history. Its deal to buy 250 single-aisle planes from Airbus for $26 billion, with an option to buy 100 more, is significant for Indian aviation and for India's ability to impact global growth. The deal, on top of its firm orders for 100 current-generation A320s and 180 A320neos, also shows the high level of ambition that Indian companies are now displaying. Becoming global players, and achieving scale, will increase the impact that Indian companies have in the world market.
India, the ninth-largest aviation market, is projected to be one of the five fastest-growing markets by 2034. IndiGo's deal only underscores the bullishness in passenger traffic growth in the long term. The only profit making airline is slated to raise money through an IPO, and the strategy to acquire the same aircraft would bring down maintenance, overhauling and spare-part costs. GoAir had also placed orders for 72 similar aircraft in 2011, valued at about $7 billion.
17/10/14 Economic Times
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