Tribune News Service
New Delhi, December 6
Distressed low-cost carrier SpiceJet rejects it, but the uncanny similarity between its and erstwhile Kingfisher Airlines’ flight path is hard to miss.
The civil aviation regulator — the Directorate General of Civil Aviation (DGCA) — yesterday withdrew 186 slots of SpiceJet and asked it to clear salary dues of all its employees in the next 10 days, thus making official the airline’s financial distress. The big question now is: Is Kalanithi Maran-promoted SpiceJet headed the same way as Vijay Malaya-owned Kingfisher Airlines?
Concerned over its deteriorating condition and large-scale flight cancellations, the DGCA also directed SpiceJet officials to file a “convincing schedule” by December 15 to clear over Rs 1,500 crore of its dues to various vendors, including airports and oil companies, not to take bookings of flights over one month and refund the booking amount to the customers of cancelled flights in 30 days.
Kingfisher’s dangerous descent also started the same way: First it was unable to pay salaries and dues to oil companies and flight were cancelled. Finally, it waited for investors to appear on the horizon, which did not happen till its last flight in 2012.
Sources say 93 arrival and 93 departure slots were withdrawn as SpiceJet was operating 232 flights in October instead of 339 in September. Its fleet strength is reduced and many pilots have left the company for better prospects.
Aviation experts say it needs an immediate investment of at least Rs 1,000 crore and another Rs 500 crore to sustain operations.
Experts say operations and finances are closely interrelated. Once operations are scaled down, it invariably forms along with other related factors a vicious circle, which becomes increasingly difficult to escape with the passage of time. The withdrawal of slots means a decrease in number of flights and further loss in revenues. Once an airline’s footprint goes down, so does confidence that flight safety procedures are being followed.
DGCA officials say they will be carrying out heightened surveillance of all SpiceJet flights on landing to ensure safety is not compromised because of financial constraints.
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