New Delhi, Oct. 15: Low-cost carrier IndiGo today said it would buy 250 A320 neo planes from Airbus for $25.5 billion, making it the European manufacturer’s largest order in terms of the number of aircraft.

“This new order reaffirms IndiGo’s commitment to the long-term development of affordable air transportation in India and overseas,” IndiGo president Aditya Ghosh said.

Though Airbus did not provide the value of the IndiGo order, its website shows the list price per A320 neo aircraft as $102.8 million.

Besides these 250 planes, the airline has the purchase rights for 100 more aircraft. These additional 100 planes will cost around $8-10 billion. The delivery of the aircraft would start from 2018.

An MoU was signed at the Airbus headquarters in Toulouse, France, by IndiGo co-founders Rakesh Gangwal and Rahul Bhatia. Bhatia is also the managing director of the airline’s parent InterGlobe Enterprises.

“The additional aircraft will enable us to continue to bring our low fares and courteous, hassle-free service to more customers and markets and will create more job opportunities and growth. The IndiGo team is energised and excited to herald this new phase of our growth,” Ghosh said.

Thanking the company for “their tremendous vote of confidence”, Airbus president and CEO Fabrice Brégier said, “The A320 neo continues to dominate world market share and this commitment confirms the A320 family as the aircraft of choice in the most dynamic aviation growth markets.”

The A320 neo incorporates innovations such as latest engines and large sharklet wing-tip devices, which together deliver 15 per cent in fuel savings from the first day and 20 per cent by 2020. This is equivalent to a reduction of 5,000 tonnes of carbon dioxide per aircraft per year.

The neos face competition from planes such as Boeing 787 Dreamliners, which also claim to possess fuel-saving capabilities.

IndiGo, which competes with SpiceJet and GoAir in the domestic market, operates 83 A320 aircraft.

The airline had ordered 100 A320s in 2005 and 180 A320 neos in 2011, worth around $11 billion — the largest order at that time.

Delivery of the neos, ordered in 2011, will begin from next year. IndiGo is one of the launch customers for the neo planes.

IndiGo has also entered into a deal to take 12 A320s from Singapore’s Tiger Airways on lease. These planes will allow the airline to retire its older aircraft and keep the average age of its fleet to around six years, helping to keep operating costs down.