In an effort to improve its competitive edge over rival aircraft maker Boeing, Airbus made the decision to move forward with plans to upgrade its A320 aircraft with new engines. The resulting variant of the A320, dubbed the A320 NEO (an acronym for New Engine Option), enhances the aircraft with more efficient engines.
This decision proved very prudent in light of the recent bid the company won for an aircraft purchase from IndiGo Airlines. The order from the low-fare Indian airline represents the largest order for aircraft in commercial aviation to date. In the deal, Airbus will deliver 180 aircraft to the airline for a total price of $15 billion. Eighty three percent of the order includes the upgraded engines.
Boeing has made modifications to its latest generation of 737 aircraft which have improved fuel efficiency and comforts. While Boeing has stated that they are capable of a similar upgrade to the engines of its comparable aircraft, they have indicated that they are waiting to see what the market demands.