SpiceJet To Revive 25 Grounded Planes Amid Go First Declaring Bankruptcy
SpiceJet has around 80 planes in its fleet and is looking to revive 25 grounded Boeing 737 and Q400 aircraft, amid the grounding of Go First flights.
Go First, the budget air carrier of India recently declared bankruptcy, putting an application of voluntary insolvency resolution proceedings to NCLT. The move comes as almost 25 aircrafts of the airline, almost half of its fleet was grounded due to engine supply issue from the US engine maker Pratt & Whitney. With all the flights of Go First now grounded, other airlines in India have an opportunity to capitalize on the market share. Following the same, SpiceJet on Wednesday said it is working to revive 25 grounded planes and has so far mobilised Rs 400 crore for the revival of these aircraft.
In a statement, SpiceJet said funds for the revival of the 25 aircraft will be drawn from the government's Emergency Credit Line Guarantee Scheme (ECLGS) and better cash accruals. The airline has around 80 planes in its fleet and is looking to revive 25 grounded Boeing 737 and Q400 aircraft. SpiceJet has already taken around Rs 500 crore under the ECLGS, reported PTI.
"We are meticulously working towards return to service of our grounded fleet back in the air soon," Ajay Singh, Chairman and Managing Director of SpiceJet, said. Majority of the ECLGS funding received by the airline would be utilised for the same, which will help the airline capitalise and make the most of the upcoming peak travel season, he added. The airline has already mobilised around Rs 400 crore towards getting its grounded fleet back in the air, which will further enhance its topline.
The announcement comes a day after competitor Go First filed for voluntary insolvency resolution proceedings and decided to cancel flights for three days starting May 3. On Tuesday, Go First CEO Kaushik Khona told PTI that the airline has grounded 28 planes, more than half of its fleet, due to the non-supply of engines by Pratt & Whitney (P&W), and that has resulted in a fund crunch and subsequently the temporary grounding of operations.
"It is an unfortunate decision (filing for voluntary insolvency resolution proceedings), but it had to be done to protect the interests of the company," he had said. In a statement on Wednesday, P&W said it is "committed to the success of our airline customers, and we continue to prioritise delivery schedules for all customers.
"P&W is complying with the March 2023 arbitration ruling related to Go First. As this is now a matter of litigation, we will not comment further," it said.