SpiceJet to revive 25 grounded aircraft; to draw funds from ECLGS scheme

SpiceJet said on Wednesday that it will revive 25 of its grounded aircraft. The airline said that it has already mobilised its plan to revive the aircraft. This announcement comes as rival Go First’s files voluntary insolvency proceedings. It said that the non-supply of engines by Pratt & Whitney has forced it to ground as many as 28 flights. 

The airline said that the funds for the revival will be drawn from the government’s Emergency Credit Line Guarantee Scheme (ECLGS) scheme and better cash accruals. SpiceJet said that it has already mobilised around Rs 400 crore towards getting the grounded fleet back in air. It will further enhance its top-line. 

SpiceJet Chairman and Managing Director Ajay Singh said that the airline is working meticulously towards returning the grounded fleet back to 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,” said Singh. 

The airline operates a fleet of Boeing 737s and Q-400s, and is a prominent player in the country’s regional air connectivity ecosystem. 

The airline completed the hive-off of its cargo and logistic division SpiceXpress into a separate entity in April. This paved the way for the airline to raise funds independently. The hive-off was done to boost growth of SpiceJet’s cargo business as well as provide a more streamlined service to its customers. 

SpiceXpress’ hive-off was also done to strengthen the airline’s balance sheet and pare a significant portion of its negative net worth.

Also read: SpiceJet completes SpiceXpress hive off into separate entity

Also read: IndiGo, SpiceJet & Jet Airways shares jump up to 8% after Go First files for insolvency