One of the main reaso behind grounding of Indian Low Cost Carrier GoFirst Airlines was the inefficiency of Engine maker Pratt & Whitney. I am not saying it. Chairman of Wadia Group, Nusli Wadia is saying it. GoFirst was backed by Wadia Group.
GoFirst blames Pratt & Whitney
Wadia group backed GoFirst Airways suspended operations on May 3. Soon after this, DGCA instructed it to stop bookings for future. The airline had a revival plan, which was approved by DGCA but reviving an airline needs money. Due to scarcity of funds, the airline has failed to take-off again.
Promoter Wadia Group Chairman Nusli Wadia said that the blame goes to Pratt & Whitney for supplying faulty engines. The airline suffered losses worth Rs 10,000 crores because Pratt & Whitney supplied engines with defects. Earlier, the airline blamed the Engine maker for the technical mismanagement. Now, it has blamed it for losses incurred.
Furthermore, it failed to provide the assistance sought by the airline. This has put thousands of employees on risk of unemployment. Nusli Wadia added that in the past two years, the inaction and contractual disagreement of P&W has broken a national asset of India, which was carrying millions of passengers.
Breaking Contractual Terms
When the airline signed contractual agreements with Pratt & Whitney during ordering, P&W said that their GTF engines will not need any maintenance till 15,000 hours of life. But as soon as the airline started taking delivery of these engines, they started facing problems. The contract included that within 15,000 hours of life period, P&W will do free of cost maintenance of the engines.
As the engines started making problems, P&W abided by its promise to do free maintenance work. But then kicked the pandemic. During the pandemic, P&W said that it will not do maintenance in free and demanded money in return for maintenance. This is where, P&W broke the contract rules.
When the airline declared bankruptcy and requested for insolvency proceedings, almost 65 percent was already grounded because of engine issues. Nusli Wadia said that the airline had no options left other than declaring bankruptcy. Now, the airline has been tackled in the legal shackles of India.
SpiceJet shows interest
SpiceJet, another struggling budget airline has shown interest in acquiring GoFirst. The airline has recently received approval to raise funds worth Rs 2,250 crore. Mumbai-based Business duo Harihara Mohapatra and Preeti Mohapatra have decided to invest Rs 1,100 crore in SpiceJet. In return, they will get 21.98 percent stake.
SpiceJet Chief Managing Director wrote to GoFirst Resolution Professional Shailendra Ajmera saying that the airline has robust revival plan, which can help the grounded airline to get back in the air. SpiceJet wants to mix GoFirst with it.
It will be interesting to see, if SpiceJet really means business or is this a tactic to know internal information of GoFirst. If SpiceJet submits Expression of Interest for GoFirst, it will have access to all the records of the airline.
Source : Hindustan Times