It's been less than a week since Indian budget airline Go First announced the cancelation of flights and its filing for bankruptcy. While many were aware that Pratt & Whitney's geared turbofan (GTF) engines had their issues, the problem was all the more shocking in that it had the ability to move an airline to bankruptcy.
Despite the engine issues ongoing, the Go First CEO noted on May 6th that operations could resume within seven days if a bankruptcy court protects the airline from having its aircraft seized by lessors.
Seeking legal assistance
According to Alarabiya News, Go First should be able to resume flights in a week's timef the bankruptcy court restrains aircraft lessors from taking back aircraft. In an interview, airline CEO Kaushik Khona also noted that an emergency credit from the Indian government is being pursued to stabilize its situation. This assistance comes from the Indian government’s program to offer life-support to pandemic-hit industries.
“We will 100% be able to save the airline if the court starts the insolvency resolution process immediately...All our stakeholders, including oil suppliers, service providers are aligned to the fact that we have been continuously cooperating and transparent with them.” -Kaushik Khona, CEO, Go First
The carrier is pinning its hopes of a comeback on court protection from creditors and lessors, which are poised to seize the leased aircraft that they own.
Alarabiya reports that Dublin’s GY Aviation Lease, SMBC Aviation Capital, and Pembroke Aircraft Leasing have already started moving in to take back possession of at least 20 Airbus aircraft. In Simple Flying's own recent reporting based on ch-aviation.com data, it was revealed that 52 of the 54 aircraft in the airline's fleet being leased. Some lessors identified are as follows:
- Aviation Capital Group (4x A320neo)
- BOC Aviation (1x A320neo)
- CCB Financial Leasing (4x A320neo)
- CDB Aviation (11x A320neo)
- DAE Capital (1x A320neo)
- ICBC Financial Leasing (6x A320neo)
Go First has had its cash reserves depleted, in part by lost revenue and additional expenses stemming from grounded aircraft fitted with problematic engines. At the time of publication, the court has yet to deliver a final ruling.
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The engine troubles at Go First
Go First reports that the combustor on its Pratt & Whitney GTF engines have degraded much faster than expected. This has in turn resulted in premature failures and shutdowns. It is believed that a total of 510 defective PW1100G engines that had to be replaced in recent years and in the past month alone, there were 64 ‘defective’ engine incidents. As quoted by Alarabiya, the airline's CEO states:
“We proactively want the airline to survive...I have a lot of emotions attached to this airline. Go Air was the baby I nurtured.”
At present, all five Airbus A320-200s and 49 A320neos are parked at airports across India. Most of these jets appear to be parked in Delhi while many others can be found in Mumbai and Hyderabad.
What do you think of the Go First situation? Do you think it will get the creditor protection that it is seeking? Share your thoughts by leaving a comment!