IndiGo’s order of 500 aircraft has notably eclipsed Air India’s 470 aircraft order made only in February this year (although there was also an option for 70 aircraft). When added to IndiGo's substantial existing backlog, questions will arise whether the Indian market can accommodate this number of aircraft.
Recent estimates have the market growing at 9% annually, with the Indian government also pledging $12bn to support infrastructure development.
In addition to this, both IndiGo and Air India were running at operating losses until recently, with pricing making it difficult for new entrants to establish market share.
So far in 2023, IndiGo has flown 57.5% of the country’s domestic market capacity.
Air India and their future merger partners have only flown 26.6%
A final note is on the make-up of the order. Air India’s February order had marginally more Airbus aircraft (250 to 220 from Boeing). This order is entirely for Airbus.
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