IndiGo Develops Premium Offering as It Reviews Fuel Hedging
The airline is considering whether to increase the business-class capacity on later A350 deliveries. IndiGo has 60 A350s on order, with the first aircraft scheduled for delivery in the second quarter of calendar year 2028, subject to Airbus and supplier readiness. The carrier also has four A321XLR aircraft in operation and expects that fleet to reach seven next year.
IndiGo plans to continue investing in its Stretch product for domestic and international markets. It is conducting a detailed assessment of fuel hedging, a practice involving financial contracts to manage exposure to changes in fuel prices, as its long-haul expansion brings a different competitive environment.
The matter was discussed by the board last week, and management is expected to return with a more comprehensive assessment at a future meeting. IndiGo has not decided to begin hedging and currently considers remaining unhedged the appropriate approach. Any change would be accompanied by an explanation of its rationale, with management viewing hedging as a tool for risk management and stability rather than a bet on fuel prices.
Walsh said major Asian carriers were typically around 40 per cent hedged, while European airlines were generally 70 to 80 per cent hedged. IndiGo is examining international services from Delhi, Mumbai and Bengaluru, with greater clarity on A350 routes expected closer to their introduction. Navi Mumbai airport is also viewed as a significant long-term opportunity, while cargo is expected to play a critical role in future long-haul operations. The airline plans to expand across both Mumbai airports without sacrificing the efficiency of its narrow-body network, and has also called for lower airport charges and taxes.