Airbus A320neo Suffers New Setback With Delayed Indian Delivery

  • IndiGo handover stalled for `industrial reasons,' carrier says
  • Holdup follows Qatar Air's refusal to take first revamped jet

Airbus Group SE’s latest A320neo model suffered a fresh blow after No. 1 Indian airline IndiGo said it had been told its first jet would be late, two weeks after Qatar Airways Ltd. put back deliveries citing engine issues.

The planemaker blamed “industrial reasons” for the delay in Indigo handovers, the carrier’s owner, InterGlobe Aviation Ltd., said in a filing Monday. Airbus is “in discussions with our first customers on their delivery milestones,” spokesman Justin Dubon said, declining to comment on individual clients.

The setback comes after Qatar Air, due to be the first user of the revamped narrow-body, balked at taking receipt because of problems with the cooling of the jet’s Pratt & Whitney turbines that may mean aircraft have to be held on the ground for longer. Deutsche Lufthansa AG subsequently stepped in to take the initial delivery, with Indigo scheduled to be next in line.

“IndiGo does not have clear visibility of its future A320neo delivery schedule, and the potential for additional delays exists,” the Gurgaon-based discount carrier said. Airbus informed it of the delay last Thursday, with the first plane due to have been handed over on Dec. 30.

Capacity Options

Shares of India’s biggest airline fell as much a 5.2 percent and traded down 4.7 percent at 1,085.90 rupees as of 1.50 p.m. in Mumbai. Shares of Toulouse, France-based Airbus fell 1 percent in Paris and were later priced 0.7 percent lower at 62.85 euros.

IndiGo said it’s looking at options to cover the shortfall in capacity. President Aditya Ghosh said in a text message that he had nothing to add, and didn’t reveal whether the airline will seek compensation from Airbus.

The manufacturer said that its new plane has been certified by both the European Aviation Safety Agency and the U.S. Federal Aviation Administration, adding: “What counts is that we deliver a service-ready A320neo for our customers.”

Indigo said in August it would buy as many as 250 A320neos from Airbus in what was the European company’s biggest-ever order ever by number of planes, with a list value of $26.6 billion. In January 2011, IndiGo agreed to take 180 Neos valued at $15 billion.

Delays in delivering new aircraft models are not unusual. Boeing Co. three years behind schedule with its 787 Dreamliner, leading airlines to seek millions of dollars of compensation from the Chicago-based planemaker.

Airbus Chief Executive Officer Tom Enders said last week that the company is set to deliver 14 of its latest A350 wide-body jets this year, one fewer than targeted, as cabin-equipment suppliers struggle to meet production goals. The model, which had its first handover last December, achieved only 10 deliveries in the first 11 months.

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