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Jet Airways Grounds Fifth of Its Fleet

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Jet Airways Grounds Fifth of Its Fleet

Jet Airways Grounds Fifth of Its Fleet
March 04
11:19 2019

LONDON – Indian Carrier Jet Airways has grounded a further 10 aircraft in the last four days as the woes for the carrier continue.

The airline grounded six aircraft were grounded on February 28 with an additional four spread over March 1 and March 2.

In a report from FlightGlobal is was stated that the carrier had disclosed the plans for aircraft groundings in a number of letters to the Indian stock exchange.

These additional grounding has now seen the number of aircraft rise to 23. The move has come from the carrier due to non-payment of amounts which are outstanding to lessors under their respective lease agreements.

IT is believed that of the 115 aircraft in the Jet Airways fleet 100 of them are leased, with GECAS, BOC Aviation and Aircastle among the most exposed lessors form the airline’s financial woes.

This means that Jet Airways now has around a fifth of its total fleet grounded as the carrier continues to struggle. Shares in the airline have risen in the last couple days by 5.32 per cent after the former Chairman Naresh Goyal left his position at the airline.

Jet Airways and shakeholder Etihad said: “the airline would re-emerge as a viable and robust airline to reclaim its rightful place as airline of first choice for its customers,”. This statement was made shortly after the airline released its plans on how it would solve its growing financial issues.

When Goyal announced he was to step down he wrote a letter to his employees saying: “While a few steps remain, some critical steps are behind us and the remaining approval processes are well underway… in the last 25 years I have given my life for this company and its employees and today more than ever I am willing to do whatever it takes to ensure that our Jet Airways not only survives but also thrives and dominates and remains the first choice for our customers as before”

Etihad who own a 24 percent stake in the airline have agreed to inject the needed funds into the airline, with Goyals 51 percent stake int he airline now believed to be dropping down to 22 percent, with the airlines board agreeing that a majority stake of 50.1 per cent to the lenders by converting part of its debt into equity.

It is not yet clear how the airline will fully proceed with its plans to save the future and whether or not the announcement from Goyal to step down as Chairman will affect Etihad 24 per cent stake in the company, however, it is clear that the airline has got some more obstacles to overcome as it continues to fight for its survival.

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Tomos Howells

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