Go First management has notified the Directorate General of Civil Aviation (DGCA) that whenever operations begin, the airline is ready to restore flight operations with 152 flights per day. Mint was unable to independently verify the news developments.
Business Standard said that the airline, which is currently under the direction of insolvency resolution specialist Abhilash Lal, has not been operating since May 3.
The reason behind notifying the authority to restore flight operations
According to the article, until April, Go First had a fleet that ran 200 daily flights before running into financial trouble and ceasing operations. The airline claimed that it has the requisite workforce—roughly 675 pilots and 1,300 cabin staff members—to operate its existing fleet of 26 aircraft in the most recent restoration plan submitted to the DGCA.
According to Economic Times, Kaushik Khona, the current CEO, has been proposed as the nominee to oversee daily operations and serve as the account manager for the airline by Abhilash Lal, the resolution specialist of Alvarez and Marsal consulting firm. The transport company notified the authorities that it needs 200 crore to restore flight operations after declaring insolvency last month. Through the federal government’s emergency line of credit guarantee program (ECLGS), it has access to ₹400 crores in funding and also has undrawn loans available.
The airline is currently in negotiations with lenders to obtain interim money in the amount of ₹200 crore, which will be used to pay vendors and cover employees for the months of April and May.
The airline needs ₹12 crores to maintain regular operations in a cash-and-carry manner, according to its business strategy. The airline’s promoter, the Wadia Group, invested ₹250 crores in the business during the last week of April to help with this.
In accordance with court documents submitted by Go First at the beginning of May, the airline owes creditors a total of about ₹11,400 crores, of which ₹6,520 crores are owed to them. The Directorate General of Civil Aviation (DGCA) demanded assurances concerning the availability of pilots and cabin crew in order to maintain smooth operations.
The airline responded that it presently has a reservoir of 340 pilots, 680 cabin crew members, and 530 engineers, which is thought to be sufficient for running its fleet of 22 aircraft, despite having experienced multiple resignations.
Crisis-hit Go First Airlines said last week that all of its scheduled flight services will be canceled through June 7 and that all customers will receive a full refund.
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Due to a large increase in ticket costs, particularly on travel routes that were previously operated by Go First, the government asked airlines to set up a method to preserve affordable airfare pricing earlier on Monday.
According to a report by PTI, following a one-hour meeting with the airline’s consulting group, Civil Aviation Minister Jyotiraditya Scindia raised his concerns about the sudden increase in airfares on some routes.
DGCA on restoring flight operations
Prior to this, Go First Airlines was urged by the Directorate General of Civil Aviation (DGCA) to present a thorough reorganization plan in order to sustainably resume operations.
The consortium of lenders, headed by the Central Bank of India, is reportedly reluctant to give money to Go First, according to sources cited by ET. According to reports, money will only be granted if two conditions are met: first, the DGCA must approve the airline’s request to resume operations, and second, the company must submit a detailed and convincing business plan.
In response to petitions filed by three lessors demanding control of their engines and aircraft from the Wadia group entity, which is presently undergoing the Corporate Insolvency Resolution Process (CIRP), the NCLT on Monday instructed the IRP of Go First to provide a reply within one week. It has been mandated by the National Company Law Tribunal (NCLT) to list the case on June 15 for the next hearing more than 50 of the 56 aircraft in Go First’s fleet were grounded because of engine issues when the company stopped offering its services.
