IndiGo's Fresh Engine Troubles May Push Airfares Even Higher

IndiGo appears confident in meeting its capacity guidance for October, where the airline expects it to go up “north of mid-teens”

An IndiGo plane on tarmac. (Photo: Vijay Sartape/BQ Prime)

The troubles with Pratt & Whitney’s GTF engines never seem to end, and IndiGo is almost always caught on the receiving end.

Pratt & Whitney, one of the few aircraft engine manufacturers around the globe, developed a new technology in the Geared Turbo Fan engines, one of the two engine choices for airlines to power their A320neo aircraft, the workhorse of Indian aviation. IndiGo, Air India, Vistara and Air India Express operate a large number of A320neo aircraft in India.

Pratt & Whitney promises a 20% fuel and emissions savings per trip with GTF powered aircraft, and in the aviation business, every drop of fuel savings is targeted. In 2018, PW said that three Indian carriers, including IndiGo, Go Air (now Go First) and (now defunct) Air Costa, had ordered over 600 GTF engines, about 10% of the global order book for the engine then.

IndiGo’s Earlier Brush With Engine Issues

IndiGo started to induct the A320neos with the GTF Engines in March 2016, and since then has seen multiple troubles with this new technology. Mid-flight engine shutdowns and warnings became common, often causing diversions and a headache for the airline and its passengers. The Indian regulator, DGCA, had to step in and warn the OEM to give top priority to sort out the issues with the aircraft.

IndiGo themselves moved on from the PW GTF engines to award a significant order to the other engine maker for the A320 aircraft family, CFM Engines, whose LEAP engines have been performing more steadily and are also hung on the planes that Air India, Vistara, Akasa and Air India Express fly. The last GTF-powered aircraft with IndiGo was delivered in 2020.

As of September 2023, IndiGo has about 334 aircraft in its fleet, of which GTF Engines power 137. With these earlier known issues, IndiGo has about 45 aircraft grounded across the country awaiting engines from Pratt and Whitney. The airline does not comment on the number of aircraft grounded, so these numbers were aggregated from FlightRadar24 and other aviation data websites.

New Troubles With Possible Contamination In The Engines

Pratt & Whitney parent entity RTX mentioned in July 2023 that a rare powder metal defect could lead to the cracking of some engine components in the twin-engine Airbus A320neo and called for an accelerated inspection of these engines. Engines are usually sent for inspections when they have crossed certain milestones in terms of hours of operation.

These accelerated checks are expected to lead to a grounding of 600-700 Airbus jets between 2023 and 2026, with two-thirds of the engine removals planned for 2023 and early 2024. The contamination occurred on engines produced between 2015 and 2020, and hence, IndiGo has a large chunk of these aircraft and will most likely be the most impacted.

IndiGo Expects To Ground Another 35 Aircraft

IndiGo first discussed the possible impact of this issue on the carrier in their earnings call on Nov. 3. It has also issued a statement of the impact it sees on its operations. As per the late-night statement from IndiGo on Nov. 7, the airline expects to have “Aircraft on Ground” in the mid-thirties range in the fourth quarter of this financial year. These are over and above the aircraft already grounded due to earlier issues. RTX Chief Executive Officer Greg Hayes had told Reuters in July that they expected to finish work on each engine in less than 60 days.

Put together, this could mean that about eighty aircraft in IndiGo’s fleet, or about a quarter of the fleet, could be grounded in the foreseeable future. The number is larger than the narrowbody fleet of Vistara at 73 aircraft, which has about 10% market share in domestic airline operations in India.

IndiGo Is Trying All Approaches To Fix This

Inducting an aircraft is a long-term measure, and usually, airlines do not try and build in some slack, apart from downtime for shop visits and maintenance. So, it is not like IndiGo has too many aircraft that can take the burden of these aircraft that will be grounded. But IndiGo, on the recent call, mentioned how it was trying to work around this issue.

This an environment where, due to supply-chain challenges, even older aircraft are going at a premium and hard to find. However, IndiGo mentioned that it has retained 14 of its older Airbus A320ceo aircraft, extended leases on 36 other aircraft and is taking 11 additional aircraft on wet-lease starting November. It is also leasing 12 more A320ceos from the secondary market starting in January, as indicated by IndiGo's chief financial officer, Gaurav Negi.

IndiGo appears confident in meeting its capacity guidance for the October – December 2023 quarter and fiscal 2023-24 guidance, where it expects capacity to go up “in the north of mid-teens”.

What About The Passengers?

Luckily, this is not a last-minute surprise for the passengers and the airline. While there is no 1:1 replacement of the grounded aircraft, the January to March quarter is traditionally weak, which means passengers, in most cases, even if there are cancellations, should be able to be accommodated by the airline far in advance.

As for fares, it might be a different story, though. Fares are already high on the back of high fuel prices, which might increase if occupancy increases due to this upcoming planned grounding.

The only question is, where will these aircraft be parked while their engines are flown out of the country? Delhi, Bengaluru and other major airports are already bursting at their seams and already have rows of parked aircraft. Where will these ones go?

Ajay Awtaney writes about aviation and passenger experience at LiveFromALounge.com and Tweets at @LiveFromALounge.

The views expressed here are those of the author and do not necessarily represent the views of BQ Prime or its editorial team.

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