India’s Go First airline declares bankruptcy, suspends all flights
New Delhi, May 2 (EFE).- Indian airline Go First, owned by the Wadia business conglomerate, on Tuesday began voluntary insolvency proceedings and suspended all its scheduled flights immediately amid a severe funds crunch triggered by supply chain issues.
In a statement, India’s third-largest airline blamed its engines supplier, United States-based Pratt & Whitney, of not fulfilling an agreement and forcing it to ground “approximately half” of its fleet in recent months, which resulted in massive financial losses.
The inability to use 25 of its Airbus A320neo aircrafts caused losses worth $1.39 billion, according to the low-cost carrier, which aims to recover the sum through a lawsuit against its US partner.
However, Go First added that as it awaited a resolution of the matter that could allow a “return to full operations by August/September 2023,” the airline was “no longer in a position to continue to meet its financial obligations.”
The funds crisis resulted in the airline on Tuesday seeking to declare bankruptcy with the Delhi branch of the National Company Law Tribunal and suspend all its flights while awaiting the authority to approve its insolvency request on Friday.
The Go First website witnessed several outages on Tuesday, even as several Twitter users complained of their flights being cancelled without prior notice.
The airline operates on nearly 20 domestic routes along with several international ones.
The carrier’s troubles come at a time when the Indian aviation sector is booming, having overtaken pre-pandemic figures and registering a record air traffic of nearly half a million passengers on Apr. 30.
India’s flag carrier Air India, owned by the Tata Group, in February signed agreements to purchase 470 aircrafts from Airbus and Boeing, marking the largest order in the history of commercial aviation.
A few weeks ago, Boeing announced that it would establish a facility in India to convert its 737 passenger jets into cargo planes. EFE
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