In a shocking development in Indian Aviation , One of the growing economies supporting record number of passenger flying everyday, Wadia group’s Venture from 2005 - Go First on Tuesday announced that it has filed for voluntary insolvency at National Company Law Tribunal (NCLT).
Kaushik Khona , the CEO of the company, made an announcement in this regard, news agency PTI reported. “Go First is suspending flights due to a severe funding crunch,” Khona told to reporters.
The cash-strapped airline also suspended all its flights for May 3 and 4 reportedly due to cash flow woes. Nearly half of the airline’s fleet has been grounded, which has caused serious problems for the company.
According to the company's website, “With one of the youngest fleets in the world made up entirely of 57 state-of-the-art Airbus A320 aircraft, Go First flies to 31 domestic and 10 international destinations with over 200 flights daily.”
Mentioned earlier, airline’s cash flow has been seriously affected, as more than half of its fleet has been grounded due to recurrent issues and non-supply of engines from Pratt & Whitney engines, which powers its Airbus A320 neo aircraft.
The airline has been looking for a strategic investor in the company and is in talks with few potential investors. Industry insiders say that the airline has been struggling financially for some time and is now in cash-and-carry mode, meaning it has to pay daily for the number of flights it wants to operate.
Following these issues, Go First has reportedly filed an emergency petition against Pratt & Whitney in the US Delaware federal court over the non-supply of engines, on Tuesday. According to reports, the airline has claimed that it will go bankrupt if engines are not supplied soon.
Meanwhile, aviation regulator DGCA has issued show-cause notice to Go First for cancelling flights. Go First has also been directed to submit the details of the steps taken to mitigate the inconvenience caused to the passengers booked on flights for 3rd & 4th May and submit their plan of action to operate flights as per the approved schedule from 5th May 2023 onwards.
Courtesy : DGCA , India.
The airline has informed the government about the developments and will also be submitting a detailed report to aviation regulator Directorate General of Civil Aviation (DGCA).
"Flights will be suspended on May 3 and 4. Once the NCLT admits the application, then the flights will be restarted" , Khona said. Go First has more than 5,000 employees on its Payroll.
