If the bankruptcy court prevents lessors from reclaiming its aircraft, Go Airlines India Ltd., which filed for bankruptcy citing Pratt & Whitney engine issues, expects to resume flights within seven days.
CEO Kaushik Khona said in an interview on Saturday that the airline run by billionaire Nusli Wadia’s business has enough cash to sustain operations on a cash-and-carry model for around 10 days. He added that Go Air is attempting to apply for an overdue emergency credit under the Indian government’s programme to provide financial assistance to sectors afflicted by the pandemic.
If the court initiates the insolvency resolution process “immediately,” “we will hundred percent be able to save the airline,” claimed Khona. “All our stakeholders, including oil suppliers, service providers, are aligned to the fact that we have been continuously cooperating and transparent with them.”
After having to ground half of its Airbus SE A320neo aircraft due to engine problems, costing the company 108 billion rupees ($1.3 billion), Go Air (now known as Go First) filed for insolvency protection on Tuesday. To prevent lessors from reclaiming its aircraft and creditors from cashing guarantees and letters of credit, the company has requested a moratorium from India’s bankruptcy court, the CEO confirmed.
Lessors such as Dublin’s GY Aviation Lease, SMBC Aviation Capital, and Pembroke Aircraft Leasing have begun moving in to reclaim at least 20 Airbus jets pending a final judgement from the court, which heard the issue on Thursday.
Before the busiest summer travel season, airlines around the world have been hit by Pratt engine problems. Due to Pratt engine problems, one-third of Deutsche Lufthansa AG’s A220 aircraft is currently stuck in Zurich. In order to fix its grounded A320neo fleet, Turkish Airlines has turned to Pratt for leased engines and technical help.
Premature failures and shutdowns of Pratt engines, according to Go Air, were caused by a deteriorating combustor. Because of this technical problem, the airline had to remove 140 engines out of a total of 510 problematic GTF engines that were to be replaced or switched between 2016 and February 2023.
Khona added that 16 Airbus planes have not yet been delivered to Go Air and that the airline has asked the European manufacturer to delay the delivery of three planes due to engine problems. About 39 billion rupees is owed to creditors by the airline and is backed by the firm’s assets and a 30-billion-rupee plot of land owned by the Wadia Group.
“We proactively want the airline to survive,” said Khona, who returned Go Air in 2020 after having led the company for three years between 2009 and 2011. To say I feel strongly about this airline would be an understatement. I raised Go Air from infancy.