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Domestic carrier SpiceJet will borrow nearly Rs 400 crore to revive 25 grounded aircraft, the company said in a statement on Wednesday. The development comes after its rival Go First on Tuesday filed for insolvency proceedings with the National Company Law Tribunal (NCLT).
SpiceJet has mobilised a plan to revive 25 grounded aircraft and it will draw the funds from the government’s Emergency Credit Line Guarantee Scheme (ECLGS) and better cash accruals, the company said.
It added that the no-frills airline has already mobilised around Rs 400 crores towards getting its grounded fleet back in the air, which will further enhance its top-line.
“We are meticulously working towards return to service of our grounded fleet back in the air soon. Majority of the ECLGS funding received by the airline would be utilized for the same, which will help us capitalise and make the most of the upcoming peak travel season,” SpiceJet Chairman and MD Ajay Singh said in the statement.
On Tuesday, Go First said it has filed for insolvency after the “ever-increasing number of failing engines’, and blamed US-based Pratt & Whitney’s (P&W) International Aero Engines.
The Wadia group airline said that the failure of engines has led to the grounding of 25 planes, or half of its fleet of Airbus A320neo aircraft, and has led to significant financial stress. Go First is the first domestic carrier since Jet Airways to go to the NCLT for insolvency proceedings.
