According to sources familiar with the matter, Go First is planning to resume its flight services by May 24th, with a smaller operation. The airline has 51 and 37 departure slots at the main airports of Delhi and Mumbai, respectively. Until May 2nd, 27 Go First aircraft were in operation.
A person familiar with the matter was quoted by Economic Times as saying, “There is a plan to resume operation as early as possible but it will be with a truncated schedule.”
Go First Cancelled All flights Until May 19
Go First had earlier announced that it has cancelled all its flights until May 19th. Prior to that, the cancellations were till May 12th. The airline has assured passengers that full refunds would be issued to the original mode of payment.
Due to operational reasons, Go First flights until 19th May 2023 are cancelled. We apologise for the inconvenience caused and request customers to visit https://t.co/qRNQ4oQROr for more info. For any queries or concerns, please feel free to contact us. pic.twitter.com/T1WktKJIuZ— GO FIRST (@GoFirstairways) May 10, 2023Advertisement
NCLT Grants Moratorium to Go First
In a recent judgement, the National Company Law Tribunal (NCLT) agreed to grant Go First protection under a moratorium from recovery by lessors and lenders. The NCLT also ordered that the company be kept as a going concern and ensure that no employee is retrenched.
Go First CEO, Kaushik Khona, said, “This is a historic ruling as an application of insolvency has been admitted so fast. The order prevents a viable airline from becoming an unviable one. The purpose of IBC has always been revival.”
Go First Seeks Bankruptcy Protection to Renegotiate Contracts and Debt
This marks the first time an Indian airline has voluntarily sought bankruptcy protection to renegotiate contracts and debt.
However, this move could complicate repossession efforts by lessors, who have recently filed requests with India’s aviation regulator for the return of about 40 Go First planes after rental payments were missed.
Go First, previously known as GoAir, has blamed its financial crisis on “faulty” Pratt & Whitney engines that grounded about half its 54 Airbus A320neos. The US engine maker, part of Raytheon Technologies, has denied the claims as being without evidence.
In conclusion, Go First’s plan to restart its flight services on May 24th with a smaller operation comes amidst its financial troubles caused by “faulty” engines and missed rental payments. The National Company Law Tribunal’s decision to grant Go First a moratorium from recovery by lessors and lenders has provided some respite. As the airline faces these challenges, it remains to be seen how it will emerge from this crisis.
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