Troubled airline Jet Airways on January 30 clarified its aircraft were grounded for ‘scheduled termination’ of a lease and ‘engine normalisation’ exercise and that they will rejoin operations on February 1.
In a release to the stock exchange, Jet Airways said, it has grounded one aircraft for scheduled termination of its engine’s lease and one aircraft for technical reasons. It is also in process of redelivering three aircraft to lessors due to the scheduled expiry of their respective lease terms, it said.
“To date, we have not grounded a single aircraft due to any grounding notice received from GECAS,” the company said in the release.
The statement comes a day after reports that Jet Airways has been forced to ground five of its aircraft, with the lessors starting the process to take back their planes following delay in payments.
The airline follows a sale and lease model, where it sells new aircraft to lessors before leasing them back. Of its fleet of 124 aircraft, the airline owns 16.
“The company is actively engaged with all its aircraft lessors and has been regularly providing updates on the efforts undertaken by the Company to improve its liquidity. Aircraft lessors have been supportive of the company’s efforts in this direction,” the company said.
The airline, which reported huge losses in the last three quarters, is facing a severe liquidity crunch. It defaulted on loan repayments on December 31, 2018. The company, which has debts of over Rs 8,000 crore, now needs to repay about Rs 1,700 crore by March.
Last week, it announced an extraordinary general meeting on February 1, to get shareholders nod to turn debt into equity. It also wants to increase its authorised share capital.
In its statement on Wednesday, the airline it is making “all efforts to minimize disruption to its network and informing and re-accommodating its affected guests,” following the flight cancellations.
“More importantly, the airline’s key stakeholders are actively engaged towards finalization of the resolution plan,” it added.
The airline is in talks with its partner Etihad Airways, which holds 24 percent stake in Jet, and bankers to come up with a resolution plan, which will eventually lead to an infusion of capital.