We have already discussed here Transponder 1200 about the security problems detected in the low-cost airline SpiceJetby the Indian aviation regulator, the Directorate General of Civil Aviation (DGCA), for several incidents that have occurred in recent weeks.
Fortunately, nothing serious, but the authority has asked SpiceJet to reduce its operations by 50% for 8 weeks, while it comes up with the maintenance and review of the fleet because it does not want more problems security. This, of course, has consequences for the company, especially in terms of income, as it significantly reduces its operations.
This adds an additional problem to your list, since a lessor has asked you to return 3 Boeing 737 aircraft, the lessor is AWAS, a subsidiary of DAE Capital. Since last week, the DGCA published on its page a notice about the cancellation of the aircraft registrations requested by the lessor AWAS, so that SpiceJet will not be able to operate them when they are cancelled.
The airline claims that it is normal and part of its strategy to return the older aircraft for refurbishment and that this was already planned, but some Indian media claim that the aircraft was actually recovered due to lack of lease payments. In fact, the airline says it is in the process of renewing the fleet with 737 MAX 8 aircraft, of which it will receive 50 during 2022 and 2023, of which 20 are assigned to replace the oldest ones in the fleet.
During a presentation at the Bombay Stock Exchange on August 1, SpiceJet highlighted:
Operations are still completely normal. All our flights today are departing on time and there are no cancellations. We are operating with excellent load factors and bookings remain strong. Our load factor on 30 and 31 July was 81% and 82.4%, respectively”.
But although they deny that the company’s operations are still affected, the fact that its flights are reduced by half by order from the authority, of course, has an impact. They are therefore evaluating the sale of a significant stake in the company to an operator in the Middle East or to a group in India, in order to obtain liquidity that will allow them to meet their commitments. Nothing concrete yet and no Middle East airline has commented on this matter.
This could be the opportunity Jet Airways has been waiting for to try and make a comeback, with a major competitor in deep trouble and reduced flights.
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