Go First files for bankruptcy amidst flight cancellations

A Go First aircraft on the taxiway
Nisarg Vyas (GFDL 1.2 or GFDL 1.2 ), via Wikimedia Commons

Indian low-cost carrier Go First has now filed for bankruptcy at the National Company Law Tribunal (NCLT), citing aircraft groundings arising from spare parts supply as the problem.  AviationSource writer Gaurav Gowda reports.

On 2 May 2023, the airline initially said that the flights would be grounded over the following two days, with the grounding period subsequently extended to 6 May.

According to Livemint, sources close to the matter have now said that the airline plans to suspend its operations until 15 May.

This decision has left many passengers stranded across the country as last-minute air fares are soaring high, and with Go First having 7% market share it is likely to impact many people’s vacation plans.

This is the peak season for airlines in India, and most Indian travelers make use of the long vacations in schools and colleges and plan for domestic and international trave.

This is naturally also the time when every airline tries to increase their capacity to peak and earn revenue.

AviationSource previously reported that due to P&W engine supply issues, Go First had been forced to ground majority of its fleet. As a result the airline was operating less flights than that of last year due to the maintenance support issue.

The CEO of Go First Mr.Kaushik Khona blamed engine manufacturer P&W for the sad state of the airline, he also said that Pratt & Whitney failed to comply the ruling of emergency arbitrator.

The airline had sought compensation from the engine manufacturer, which was denied, and hence Go First filed an emergency hearing in USA as well against Pratt and Whitney.

Go First has 61 aircraft in its fleet, and this sudden decision has put the future of the airline and its employees in dark.

In India no airline once grounded has ever taken back to skies; be it Jet Airways or Kingfisher, the airline was already on cash & carry basis.

With the majority of its fleet grounded and few more expected to be grounded in the coming days, the airline did not find it viable to continue its operations as it had been suffering huge losses since the issue with Pratt & Whitney surfaced.

Apart from Go First, even Indigo has suffered due the engine issue but the airline has been compensated by the engine manufacturer for the disruption caused.

There were also reports of Go First operational crew stuck in their layovers as the carrier suddenly announced suspension of its flight operations, and the actual resolution offered to those affected is as yet unknown.

Many passengers across the country took to social media to vent their frustrations as some claim their refund of flights cancelled 2 months back are not yet processed while some are asking airline for resolution as last-minute airfares to their destination has skyrocketed.

Airlines have been running at 90% of their capacity due to the seasonal demand especially on major routes like BOM-DEL, DEL-BLR, BOM-BLR.

Now, cancellation of Go First last minute has further increased the demand for seats.

The history of the Pratt & Whitney problem

Explaining the issue between Pratt & Whitney and Go First, the airline in March had applied for an emergency arbitration as they alleged that P&W was not complying with their contractual obligations.

The ruling found in favor of Go First and it directed P&W to start supplying 10 leased engine every month starting April 20, 2023.

Immediately after this ruling, the engine manufacturer wrote stating that it would comply with the ruling and will start providing the engines on the said date.

Go First was confident about the relief on the way, and its promoters had infused another Rs290 crore into the airline, but this was short lived as the airline found out that the manufacturer was trying to find loopholes in the ruling.

This award also mentioned that Go First did not have to provide security in order to get the said services from the engine manufacturer.

The airline was therefore very confident that P&W would comply with the ruling, and it would receive engines from 20 April. 

When the day came there was no response from the manufacturer, the airline filed an emergency hearing against them in US court in Delaware which admitted the case. The court has asked P&W to either comply with the ruling or provide a reply on or before 5 May 2023.

This week’s flight cancellations from the airline has attracted a “show cause” notice from India’s aviation regulator DGCA asking the airlines to explain the reason and what alternate arrangements has been made to the passengers affected.

This issue with P&W raises many questions and has also involved the Government of India authorities who said that they aware about the issue and are in constant touch with both the parties.

Now the big questions remain as to whether or not Go First will ever take to skies again and the answers may become clearer in coming days.

Having flown with Go First, I found them to be a good airline overall, despite minor shortcomings, but we would definitely love to see them take to skies again.

By AviationSource News 7 Min Read
7 Min Read
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