December 21, 2015 / 11:48 AM / in 3 years

Airbus delays A320neo delivery for Indian airline IndiGo

NEW DELHI/PARIS, Dec 21 (Reuters) - Planemaker Airbus has told Indigo, India’s biggest airline by market share, that it will not deliver its new A320neo aircraft on time because of “industrial reasons.”

InterGlobe Aviation Ltd, IndiGo’s parent company, said in a statement at the weekend that it had received notification from Airbus about the delay on Dec. 17.

“At this time, IndiGo does not have clear visibility of its future A320neo delivery schedule and the potential for additional delays exist,” InterGlobe Aviation said.

“We are looking at mitigating the potential shortfall in capacity through other options.”

Airbus said earlier this month Germany’s Lufthansa would take the first delivery of the jet after another buyer Qatar Airlines expressed concern over technical restrictions on the aircraft’s Pratt & Whitney engines.

“We are in discussions with our first customers on their delivery milestones,” an Airbus spokesman said. “What counts is that we deliver a service-ready A320neo for our customers.”

IndiGo finalised the purchase of 250 A320neo aircraft in August, handing Airbus its largest-ever order by number of planes, and took its total A320-family jet orders to 530. The airline was due to take delivery of the first aircraft on Dec. 30.

This would have been one of the first deliveries of the revamped A320neo. Industry sources said the aircraft would now be delivered a few weeks late, probably in January.

Shares in IndiGo, one of Airbus’ biggest customers, closed down more than 5 percent on Monday in a Mumbai market that gained 0.85 percent.

The A320neo, seen as a key profit driver for the European planemaker and its suppliers in coming years, won safety approval in late November.

IndiGo has made a name for itself with large, eye-catching orders of Airbus aircraft as it bets on rapid growth in Indian air travel.

IndiGo, which today operates around 100 jets, had previously ordered 180 A320neos in 2011. (Reporting by Tommy Wilkes, James Regan, Tim Hepher and Joseph Sotinel. Editing by Jane Merriman)

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