It is a few busy days for IndiGo. The airline has just ordered a massive 300 A320neo family aircraft and went through one of the biggest system failures in their history. And today, there is a press invitation that has been sent out on behalf of IndiGo and Qatar Airways, for a potential strategic alliance that will be announced on November 7, 2019.
Qatar Airways has, for years, been interested in making an investment in IndiGo, which is something Akbar Al Baker has spoken about openly. However, IndiGo has been not interested in such an alliance, given that IndiGo is perhaps the only profit-making airline in India, and has a massive war chest to fight off rivals.
As IndiGo’s domestic market share hovers around 50%, the airline has increased focus on international destinations outside the country, launching flights into various countries recently, benefiting also from the demise of Jet Airways. These include flights to the UAE, Qatar, China, Turkey, Myanmar, Singapore, Hong Kong, Maldives and planned flights include those to Georgia.
There are many ways to look at this strategic alliance. Perhaps it could just be a codeshare deal, a-la IndiGo’s own deal with Turkish Airlines, or SpiceJet’s MoU with Emirates which has yet to be activated. There was a hint of this deal last year. We analysed the potential deal for you.
Or, it could be a combined future for the airlines. Remember, Qatar Airways has always said the only airline they like in India is IndiGo, and they’ve been courting them for a while. Or a combined bid for Air India is also the view of some media, but I think this is not possible without first seeing the investment document for Air India.
It looks highly feasible that this would then, be, an IndiGo – Qatar Airways codeshare alliance to start and take another shape later. Given Qatar Airways interest in buying stakes in airlines, this may also have some sort of an equity stake, but I am not sure if this will be 5-10% or 38%
What do you make out of this announcement to come?