IndiGo is a low-cost airline headquartered at Gurgaon, India. It is the largest airline in India in terms of passengers carried, with a 42.6% market share as of October 2016. The airline was founded as a private company in 2006. IndiGo placed a firm order for 100 Airbus A320-200 aircraft in June 2005 with plans to commence operations in 2006. IndiGo took delivery of its first Airbus aircraft on 28 July 2006 and commenced operations on 4 August 2006.In 2011, IndiGo placed an order for 180 Airbus A320 aircraft in a deal worth US\($15\) billion. The airline launched international services in September 2011. In February 2012, IndiGo took delivery of its 50th aircraft, less than six years after it began operations in 2006. For the quarter ending March 2012, IndiGo was the most profitable airline in India and became the second largest airline in India in terms of passenger market share. In August 2015, IndiGo placed an order of 250 Airbus A320neo aircraft worth \($27\) billion, making it the largest single order ever in Airbus history. Neos help in saving 10-15% of the overall fuel cost. Fuel makes up for about 50% of airline’s cost.
In order to have low maintenance cost IndiGo has made sure that its average fleet age remains four years till 2032. Once all airplanes are delivered, IndiGo will not have a fleet of 530 planes — this is due to the ‘buy, sell and lease back’ strategy. At peak airlines will have 330 planes. Once the order is placed the planes are sold to lessors at market price. The planes are then leased back for the next six years — which means for the first six years IndiGo receives a plane every month. Every month a plane goes out of IndiGo’s fleet and a new aircraft joins, thus reducing the average fleet age, and with an average fleet age that is low the cost of maintenance is also lower. Because of the six year lease back plan, with the next two-and-half years one-third of IndiGo’s fleet will be Neos, and in the next six years it will have an all Neo fleet. There is a straightaway positive impact of 7% on the company’s bottomline because of the Neos. The airline has the tagline on-time focusing on punctuality.
IndiGo became one of the fastest growing low cost carriers in the world and was the largest profitable airline in India. The success of IndiGo has been attributed to its unique business model which reduces costs. The airline operates a single type of aircraft (Airbus A320) in similar seating configuration which simplifies crew training and maintenance. The airline strikes bulk deals with Airbus reducing unit costs. The airline targets a quick turn-around time of 20 minutes to get the aircraft ready for the next flight, ensuring planes fly about 12 hours every day. Employees share multiple roles with a check-in staff doubling as a baggage handler. IndiGo is the only airline to deploy ramps for boarding aircraft since this saves time as well as costs. To keep fares low, IndiGo does not provide complimentary meals in any of its flights, though it does have a buy-on board in-flight meal programme. No in-flight entertainment is available and Hello 6E is the inflight magazine published by IndiGo. 

The airlines didn’t pamper its passengers with freebies but it offered brand new,
squeaky clean planes that invariably reached their destinations on time. This reputation for punctuality saw IndiGo snatching market share as more busy executives chose its nofrills.
IndiGo offers premium services, where the passengers can avail additional benefits like a pre-assigned seat, multiple cancellations and priority check-in at a higher fare. Indigo also has an In-Flight Shop in which you can buy models and other daily use items.

Discussion Questions
1. Comment on buy/sell lease back strategy of IndiGo airlines.
2. Identify the factors behind the success of IndiGo airlines.