Largest airplane order in history

 Airbus A320 Pictures, Images and Photos

On Tuesday, Indian airline IndiGo placed the largest airplane order in history. They ordered 180 aircraft from European manufacturer, Airbus, going with the Airbus A320. The deal is valued at about $15.6 billion, list price. This doesn’t mean that IndiGo is paying the list price on their order. You would think that there is a volume discount somewhere there for them. To be clear, this is the largest airplane order in history in terms of number of airplanes, not price.

This story is interesting, less so because of the headline, but more so because it has meaning for India’s growth. One of India’s main obstacles to growth is poor infrastructure. This makes it tough to do business there. Once the infrastructure in India is improved, India will likely be a major growth market similar to China today. This massive airplane order may represent a beginning to this infrastructure development. 180 planes ordered at one time is a large amount, even for a country with 1.1 billion people. Maybe this means that they are starting to get serious about developing their infrastructure.

You need a lot more than just planes and airlines to fix India’s infrastructure, however. India needs interconnecting roads and highways that are properly paved. They also need a better rail network, among many other basic needs. The future for India is bright, however, they must move beyond their current infrastructure issues. If this airplane order is a sign that this is starting to happen, then perhaps investing in India will soon be a big opportunity. By invest I don’t necessarily mean just buying Indian companies’ stocks, but looking to sell goods and services there. Having good relations and a lot of trade with that country is smart from just about every point of view. We will see if more positive infrastructure news comes out of India this year or if this massive airplane order is just a blip on the radar.