Loading

South Asia Fleet Outlook:

Airline Leader

South Asia encompasses a diverse set of markets in terms of fleet profiles. The region is dominated by India, which accounts for 67% of the 742 aircraft in service and 96% of the 917 aircraft on order in the region. India has one of the highest order book to in service ratios in the world. At the other extreme, Bhutan has just six aircraft in service and none on order.

Summary
  • India dominates the South Asian aviation market, accounting for the majority of aircraft in service and on order.
  • The four largest airlines in the region are based in India, with IndiGo leading the pack.
  • Narrowbody aircraft, particularly A320s and 737s, are the most popular in the region.
  • Widebody aircraft are primarily operated by state-owned flag carriers, with few private carriers having them in their fleets.
  • IndiGo has the largest order book in the region, followed by SpiceJet and GoAir.
  • Indian carriers are expected to take delivery of over 600 aircraft in the next decade, but financing these orders may become challenging.

South Asia encompasses a diverse set of markets in terms of fleet profiles. The region is dominated by India, which accounts for 67% of the 742 aircraft in service and 96% of the 917 aircraft on order in the region. India has one of the highest order book to in service ratios in the world. At the other extreme, Bhutan has just six aircraft in service and none on order.

The four largest airlines in the region are all based in India, led by IndiGo with 128 aircraft. However, the Air India Group has 139 aircraft if Air India, Air India Express and Air India Regional are combined. Three airlines - Air India, IndiGo and Jet Airways - have fleets of more than 100 aircraft.

The largest South Asian carriers outside of India are Pakistan International Airlines, Trans Maldivian and SriLankan Airlines, each of which has fewer than 30 aircraft. Trans Maldivian is notable for the fact that its fleet is composed entirely of small turboprop seaplanes, providing connectivity between the International Airport and resorts on outlying islands.

Narrowbodies account for the majority of aircraft in service and on order in the region. The A320 is the most popular aircraft type in service (38.3% of the fleet), followed by the 737 (20.4%). Narrowbodies account for close to 90% of aircraft on order, driven primarily by the expansion plans of Indian LCCs.

Amongst widebodies, the largest fleet is that of Boeing 777s at 41 aircraft (5.5%) followed by the A330 (3.4%). The most popular regional equipment is the ATR 72 (6.6%). IndiGo is the largest narrowbody operator in the region, with 128 aircraft. This is almost twice the size of the second carrier, Jet Airways. The six largest operators of narrowbodies are all based in India.

Most of the widebody aircraft in South Asia are operated by state-owned flag carriers - Air India, SriLankan Airlines, Pakistan International Airlines and Biman Bangladesh. Only 24 out of 96 widebodies are in the fleets of private carriers, of which 17 are with Jet Airways. There are no LCCs in the region with widebody equipment in their fleets, however SpiceJet's Jan-2017 order contained options for 50 aircraft including 787s and 777s.

IndiGo has the largest order book in the region (and one of the largest in the world) at 415 aircraft, followed by SpiceJet (156) and GoAir (139).

Vistara is expected to be the next carrier to place a major order, of up to 100 aircraft before Jun-2017, comprised of 50 narrowbodies and 50 widebodies. The airline is expected to stick with Airbus for narrowbody equipment and is likely to opt for the 777X for long haul operations.

All South Asian airlines outside of India combined have an order book of just 39 aircraft. Two of the flag carriers in the region, Pakistan International Airlines and SriLankan Airlines, are expected to place additional orders as part of planned restructuring exercises, however the timeline and size of prospective orders is unknown at this stage.

Over the next decade, Indian carriers are scheduled to take delivery of over 600 aircraft with an estimated actual value of close to USD30 billion. Financing these orders could become challenging as market conditions tighten. As a result, not all of the narrowbody equipment may be inducted as scheduled. Several Indian carriers have embraced sale and leaseback transactions as a core strategy for generating capital to support and expand their operations.

However, dependence on liquidity from sale and leaseback income may result in increased operational losses if airlines are unable to generate sufficient profits from such transactions.

<a class=South Asia Fleet Outlook" width="750" height="577" />

<a class=South Asia Fleet Outlook 2" width="750" height="330" />