Airbus Updates No.2684

IndiGo Airlines seeks to phase-out A320-200s

IndiGo Airlines Airbus A320-200 © Airbus Industrie

05.06.2020 - 22:36 UTC

IndiGo Airlines (6E, Delhi Int'l) is planning to phase-out its 122 remaining A320-200s shortly, possibly accelerating their retirement, as it seeks to use the COVID-19 pandemic to push towards a more efficient, all neo narrowbody fleet.

"We see an opportunity here to make the fleet more efficient. Particularly with the old classic ceos, which incur maintenance costs, which you know have been a real problem for us all through the year. We're going to return them as rapidly as possible and therefore reduce our maintenance costs," Chief Executive Ronojoy Dutta said during the carrier's quarterly investor call.

According to the ch-aviation fleets ownership module, all of IndiGo Airlines' A320-200s are dry-leased. Dutta underlined that the LCC has relatively short-term lease contracts and was due to return most of the aircraft in the coming years anyway. In the case of high demand, it could evaluate extending the leases, but in the current downturn, this will surely not happen.

Dutta underlined that the airline will seek to avoid any confrontation with the lessors and will not push for early termination of leases, choosing instead to return the aircraft as scheduled. The airline has been retiring A320s over the past months, having phased out eight units since the end of March 2019.

"We will return them in their scheduled time, and if we have mutually agreed upon it, we may do it a little faster," he said.

For the time being, the airline will use the A320-200s only "when necessary" with the bulk of its reduced schedule flown on A320-200neo and A321-200neo narrowbodies.

Dutta added that IndiGo Airlines would not stop taking deliveries of new A320neo Family aircraft. The airline already operates 100 A320neo and thirteen A321neo, and has a further 230 and 383 units of the respective types on firm order from Airbus, the ch-aviation fleets advanced module shows. IndiGo Airlines also operates twenty-five ATR72-600s.

Airbus Updates No.2535

Tigerair Australia to retire A320s; Virgin moots widebodies

Tigerair Australia Airbus A320-200 © Tigerair Australia

27.02.2020 - 23:16 UTC

Tigerair Australia (TT, Melbourne Tullamarine) will retire all remaining A320-200s by October 2020 and transition to an all-B737-800 fleet going forward, parent Virgin Australia Holdings announced in its half-yearly earnings report.

"I'm pleased we can accelerate the transition of Tigerair to an all B737 fleet which will help get the business into a better financial position moving forward," Chief Executive Paul Scurrah said.

The low-cost carrier currently operates nine A320-200s and six B737-800s, the ch-aviation fleets advanced module shows. Out of the A320s, two were already scheduled for phase-out this year. The new plan also foresees the other seven aircraft being retired by October 2020. In turn, Tigerair will receive an additional two B737-800s from sister carrier Virgin Australia (VA, Brisbane Int'l).

In addition to fleet transitioning and downsizing, Tigerair will also terminate five loss-making domestic routes. As of April 28-29, 2020, the airline will cease flying from Sydney Kingsford Smith to Adelaide, Coffs Harbour, and Cairns, from Melbourne Tullamarine to Coffs Harbour, and from Hobart Int'l to Coolangatta/Gold Coast.

"Short-term capacity reductions will be made on the Tasman in Q4FY20 [from April to June 2020] due to weakening demand attributable to coronavirus," the group added.

In total, Virgin Australia Group will reduce its total capacity for the period January-June 2020 by 3%. The holding estimates that the drop in demand caused by the COVID-19 epidemic will have a AUD50-75 million Australian dollar (USD33-49 million) impact on its financial results this fiscal year.

Scurrah also told Reuters that Virgin Australia Group was contemplating a new widebody order to transition to a single-type long-haul fleet. Currently, Virgin Australia operates six A330-200s and Virgin Australia International five B777-300(ER)s.

"We are doing an exploration at the moment. If the deal is worth doing, we absolutely want to do one this year, but it is too early to speculate," Scurrah said.

The group owns one A330-200 and four B777-300(ER)s, while the remainder of its widebody fleet is leased. Scurrah said that if Virgin Australia chooses to place a widebody order, it will target deliveries before the leases start expiring in 2024.