Indigo Partners airlines kick-start single-aisle recovery with large joint order

By Judson Rollins & Bjorn Fehrm

Introduction

November 14, 2021 © Leeham News: Airbus made a splash on the first day of the Dubai Air Show, announcing a firm order for 255 A321neo family aircraft from the Indigo Partners portfolio of airlines.

This is the first large order for single-aisles since COVID-19 struck early last year, comprising 226 A321neos and 29 A321XLRs.

Indigo Partners, headed by airline veteran Bill Franke, is an Arizona-based private equity firm with stakes in several low-cost carriers around the world. Franke was present at today’s announcement along with the chief executives of all four airlines, two of whom joined the event virtually.

The airlines included in today’s order are US-based Frontier, Mexico’s Volaris, Chile’s JetSmart, and Central European giant Wizz Air. Joint orders like this are relatively uncommon except from multi-carrier conglomerates like Lufthansa Group or IAG. Indigo’s last joint order was for 430 A320neo family aircraft, announced at the 2017 Dubai Air Show.

A321neo line now sold out through 2025

Wizz Air and Frontier will get the lion’s share of the order announced today, with Wizz taking 75 neos and 27 XLRs and Frontier buying 91 neos. Volaris will get 39 neos, while JetSmart will take 21 neos and 2 XLRs. The bulk of deliveries will take place from 2025 to 2027, although a few will occur before 2025.

Airbus chief commercial officer Christian Scherer said this was a top-up order for Airbus, effectively selling out all remaining A320 family deliveries through 2025.

A321XLR’s greater capabilities, price premium indicate limited future for A321LR

The A321XLR has 700nm greater range than its previous iteration, the A321LR, and can carry more cargo. Scherer said the XLR earns a premium price over the A321neo, although it seems obvious that manufacturing cost is similar to an A321neo. The XLR is lighter – and hence more efficient – than the LR, making the latter a less capable aircraft that can’t achieve the same premium pricing. The LR thus seems to have a limited future in the market.

Wizz Air CEO József Váradi said the airline will use its XLRs to expand its network outside Eastern Europe, with most to be based in the UK or Abu Dhabi. Basing them in the UK likely points to future plans to add low-cost transatlantic service. Wizz’s intent to place XLRs in its Abu Dhabi joint venture with an Emirati holding company likely points to new destinations in Africa and South Asia.

A321neo accelerates Frontier’s sustainability push

Frontier CEO Barry Biffle said his airline has already improved its fuel economy from the US average of 60 miles per gallon per seat to 100, and this order will take it to 120. “Frontier is already the most sustainable airline in America, thanks to the A320neo family.”

Biffle said today’s order will take Frontier to a global industry goal of halving carbon emissions per seat by 2030. “Look at all these rich kids buying Tesla and wearing Patagonia, but they won’t fly Frontier,” he told LNA. “We offer the real deal when it comes to sustainability.”

38 Comments on “Indigo Partners airlines kick-start single-aisle recovery with large joint order

  1. Now we know why Airbus recently announced that it would be augmenting the FAL in China so as to also produce A321s 😏

    • Wonder if AB would accelerate its plan to meet demand.

      Now can suppliers see the new reality??

        • That would be perfect for Airbus. I wonder about no big announcements from Boeing so far – have they moved it to the second half of DAS to overshadow earlier Airbus orders?

        • Furthermore Wizz may acquire a further 19 A321neo and purchase rights for 75 more A321 neos.

  2. I’s be curious to know on what production rate scenario that “sold out til 2025” headline is based.

  3. Of relevance to this story:
    WSJ: “Airbus Says It Can’t Meet Current Demand for Single-Aisle Jets”

    “DUBAI—Airbus SE said it can’t ramp up production of its popular single-aisle jet fast enough to meet demand and forecasts delivery constraints for another three years as airlines clamor for new planes again.

    Airbus Chief Financial Officer Dominik Asam, in an interview ahead of the Dubai air show that started Sunday, said airlines are asking for delivery of new aircraft after most of them stopped ordering new jets and tried in many cases to defer or cancel orders during the Covid-19 pandemic. Airbus is pushing sales—what the industry calls sales “campaigns”—but is constrained on what it can promise, Mr. Asam said.

    “There is a really vibrant activity on campaigns, especially on the single aisle,” he said. “One real challenge we face is the lack of near-term delivery slots.”

    https://www.wsj.com/articles/airbus-says-it-cant-meet-current-demand-for-single-aisle-jets-11636899737

    • Airbus’s NB is generating cash for investment in A321XLR and A350 freighter, plus long term future projects.

  4. Re:” This is the first large order for single-aisles since COVID-19 struck early last year, comprising 226 A321neos and 29 A321XLRs.”

    Except for United Airline’s larger single aisle order in June 2021? See the excerpt below from the June 29, 2021 CNBC story at the link after the excerpt.

    “United Airlines unveiled Tuesday its largest-ever aircraft order: 270 narrow-body jetliners from Boeing and Airbus as the carrier charts its post-pandemic growth.”

    https://www.cnbc.com/2021/06/29/united-airlines-unveils-270-jet-boeing-and-airbus-order-its-largest-ever.html

    And Southwest’s 100 single aisle orders in March 2021? See the excerpts below from the 3-29-2021 Reuters story at the link after the excerpt.

    “(Reuters) – U.S. planemaker Boeing Co said on Monday it sold 100 new 737 MAX-7 jets to long-time customer Southwest Airlines, in its biggest order win since the aircraft’s safety ban was lifted in the United States late last year.”

    “Southwest, which has been flying older variants of the 737 planes for nearly 50 years, said its order book now has a total of 349 orders and 270 options for the 737 MAX jet for 2021 through 2031.

    Southwest previously had 249 orders and 115 options for the 737 MAX aircraft for 2021 through 2026.”

    https://www.reuters.com/article/us-southwest-boeing-orders/boeing-wins-biggest-737-max-order-since-safety-ban-lift-from-southwest-idUSKBN2BL1GZ

    • Re:” This is the first large order for single-aisles since COVID-19 struck early last year, comprising 226 A321neos and 29 A321XLRs.”

      It’s pretty clear that this quote is referring to Airbus…

    • Up to one-third of the carrier’s 777X orders are vulnerable?? Huge blow for BA and 777’X program.
      BA has to spend more time to fight its hair on fire moments.

      Emirates originally planned to get its first 777X in 2020, followed by A350s from 2023. Now it’s the 777X expected around the same time of the arrival of A350.

      • I think Boeing and its B777-9 will be fine in the long run. It’ll be a uniquely large aircraft to handle traffic as air travel grows by a factor or 2.5 in the next 30 years. What happened to the A380-800 will not happen to the B777-9 since the B777-9 will have state of the art engines. It’s possible that Airbus will produce an A350neo with an engine based on, for instance, Rolls Royce Ultrafan and Advance technology but that seems years away and the B777-9 will also have access to these type of engines.

        A threat to the B777-9 might be a stretched A350, the so called A350-1100.

        • I think Airbus has a moderate chance to kill the B777-X by doing an early re-engine and stretch. Could Boeing justify the expenses for a re-engine after a production run of just 5-10 years and given a relatively modest backlog? Maybe not.
          But Airbus might want to keep the market position of their A350 the way it is. Without creating a threat by forcing a possible cleansheet successor to the 777-X.

          • It depend on those airlines with very long routes hence an A350-1000 with 15% lower fuel burn would greatly increase payload and reduce fuel upload. Also the 787-10 would benefit alot with a 15% fuel burn reduction in increased payload/range. Boeing might not want to give the the 777-9 too much competition from an Ultrafan powered 787-10 but Airbus might open the Pandora box with the A350-1000 with Ultrafans making refueling/switch aircraft in Qatar/UAE not needed for routes that fill up with pax/cargo and Boeing has to follow with the 787-10″MAX” forcing GE to update the GEnX with GE9X technology pretty quick.

          • The A350 is a highly capable aircraft. It is the king of ultra long haul beating the B777-9 10% in range but it is not selling like hot cakes. Combined A350-900 and A350-1000 Production is 5-6 month versus 12-14 for the B787 and suspect around the same 5/ month production rate for B777-9. If Qantas reactivates project sunrise the aircraft may prove itself. Airbus could try its own folding wingtips.

          • The 787 production rate was 5/mo before a further reduction to 2/mo. The 12-14/mo for the 787 was its peak; at the same time, the A350 rate was 10/mo and A330 was at the time 5/mo.

          • If Boeing could not justify expenses for a re-engine, how could they possibly justify clean sheet and 10x bigger expense?

    • I would bet that there is a great deal of political pressure being applied by all sides over this order!

  5. Airbus is really crushing it. Poor Boeing.

    Boeing was right that the 787 point to point model would defeat the A380 hub-based one. It did. Only geography (Emirates) made it work.

    But no one (maybe Airbus?) pushed that logic further and thought why not push it all the way to…the single aisle… And now… the better product (A320-1 family) is doing the same to Boeing… going long haul (enough) to really a) lower wide-body sales, b) completely paralyzing the 737MAX+ family and sucking any oxygen from any NMA design.

    Boeing can’t get a new design it seems that has the 787 potential of disruption as it did then. Engines won’t rescue them. It urgently needs an excellent ‘me-too’ design. Single aisle. Direct competition against the A321 to remain in the game. Spend the 15B$ on this instead of returning cash to shareholders. Otherwise, if Airbus is able to raise production… Boeing will cede the single aisle the Airbus at 30-70% ratio. We know what that means.

    How long will suppliers remain loyal to Boeing before they start to bid additional Airbus work?? And give it even capacity? They are not stupid.

    And then there is a juicy space in Toulouse as the last A380 is basically built… lot’s of A321s coming…!!

    • Actually Boeing got it wrong. Essentially all 787 Flight have a Hub at one, and most at both ends.
      Boeing just build the better suited aircraft for all but a Megahub. And Airbus missing its mark quite badly with the A380 didn’t help its case either.

      • Two (longer range) hubs connected back to back by addidas network seem to be optimum.
        And those need a380 capacity for some of the braches.

    • He’s probably feeling suicidal by now then, following this morning’s Air Lease announcement…..

    • Made me chuckle, I thought he was the Onion in Aviation reporting. But when I looked in the comments I realized he is dead serious…

      • Small minds that perceive themselfes as unfairly set back.

        Read some joseph conrad 🙂

    • Well everybody on verovenia agrees with him..

      It probably the most hard line censored aviation blog out there.

      He never fully recovered after his beloved Boeing tried to kill his beloved CSeries and the Airbus he dislikes saved it..

    • Airbus scored a nice little order, across the board:

      ALC has now gone one step further. While it hasn’t ordered quite so many aircraft, the aircraft lessor has ordered jets from every single Airbus family as follows,

      25x Airbus A220-300
      55x Airbus A321neo
      20x Airbus A321XLR
      4x Airbus A330neo
      7x Airbus A350F

      Nice shot in the arm for the A220 line. I guess those 321Neo’s are being delivered past 2025, huh?

      https://simpleflying.com/airbus-a350-freighter-launch/

  6. Small minds that perceive themselfes as unfairly set back.

    Read some joseph conrad 🙂

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