Indian minister says Go First bailout unlikely without engine fix (updated)

Jet Airways (India)

09/05/2023 12:55

(Adds details, comments)
    By Shivam Patel and Aditi Shah
       NEW DELHI, May 9 (Reuters) - India is unlikely to bail
out Go Airlines (India) Ltd unless a solution is found to
supplying it with engines, a minister said.
    The low-cost carrier filed for bankruptcy protection last
week, blaming "faulty" Pratt & Whitney engines for the grounding
of about half its 54 Airbus  AIR.PA  A320neos.
    The airline, widely known as Go First, which has been flying
for nearly two decades, is the first major Indian airline to
collapse since 2019, when Jet Airways went under.
    India's Deputy Aviation Minister V.K. Singh told news agency
ANI that the government has previously held talks with
U.S.-based Pratt & Whitney to resolve the issue at the airline,
which until recently was India's fourth-largest by passengers
flown.
    "The problem with Go Air is that their flights are run on
engines of Pratt & Whitney which is facing management issues
since after COVID-19...So (engine) manufacturing is not
happening at the pace that it should," Singh said on Monday.
    Pratt & Whitney, part of Raytheon Technologies  RTX.N , did
not immediately respond to a request for comment on the
minister's remarks outside of business hours. It has previously
told an arbitrator that the airline's claim of defective engines
causing its demise was "astounding" and without evidence.
    "What can be done about a bailout? Where will Pratt &
Whitney get (engines)? (A) bailout can only happen when
something can be done about this," Singh said in response to a
question about the possibility of a government rescue.
    The government is moving to protect passengers first with
the aviation regulator issuing a notice to Go First late on
Monday to stop selling new tickets. 
    Go First, whose market share has fallen to 7.8% at the end
of March, from 8.8% in 2022, has also been asked to make cash
refunds to passengers for cancelled flights, a government source
told Reuters on Tuesday.
    "The government is not thinking about a bail out as of now".
    Go First's fate underscores fierce competition in a sector
dominated by IndiGo and the announced merger of Air India and
Vistara, even though India's growing industry has bounced back
from the COVID-19 pandemic and hit record passenger levels.
    On Monday Go First called on India's company law tribunal to
urgently grant its request for bankruptcy protection, as more
lessors sought to repossess planes. 

 (Reporting by Shivam Patel in New Delhi; Editing by Muralikumar
Anantharaman and Alexander Smith)
 ((Shivam.Patel@thomsonreuters.com;))