The Singapore-headquartered BOC Aviation Limited and India’s largest budget airline IndiGo have entered into a finance lease transaction involving 10 Airbus A320NEO aircraft to further expand its fleet, officials said today. All 10 aircraft, powered by CFM LEAP-1A engines, are scheduled for delivery in 2023, said BOC Aviation.
A finance lease arrangement is one where the company financing the deal buys the asset — in this case, the aircraft — and then leases it to another company. The lessor remains the owner of the asset, while the lessee has operating control over the asset.
“We are delighted to be embarking on another transaction with our long-time customer IndiGo, to enable the airline to expand its fleet with the latest technology aircraft,” said Steven Townend, Deputy Managing Director and Chief Financial Officer, BOC Aviation. “This showcases our ability to deploy alternative financing structures, to continue our long-term sustainable growth,” he said.
“We are pleased to enhance our partnership with BOC Aviation with the lease agreement for these 10 aircraft,” said Riyaz Peer Mohamed, Chief Aircraft Acquisition and Financing Officer, IndiGo.
He said that this “extended collaboration” with BOC Aviation was part of IndiGo’s expansion strategy across domestic and international markets. “India is currently among the fastest-growing civil aviation markets in the world and these aircraft will help IndiGo consolidate its position in the region,” said Mohamed.
BOC Aviation is a leading global aircraft operating-leasing company with a fleet of 652 aircraft owned, managed, and on order. Its owned and managed fleet was leased to 91 airlines in 42 countries and regions worldwide as of June 30, 2023.
InterGlobe Aviation Ltd (IndiGo) has a fleet of over 300 aircraft, and it is operating about 1,900 daily flights and connecting 79 domestic destinations.