Wadia Group-owned Go First is open for partnerships but its promoters are not looking to exit from the loss-making aviation business, according to an airline source. The no-frills airline, beset with engine woes, is estimated to have incurred a loss of Rs 1,800 crore in 2022-23, and expects around Rs 600 crore fund infusion in the coming weeks, according to the source closely involved in the management of the carrier.
The airline, which was cornering an 8-10 per cent market share for many months, saw it slipping to 6.9 per cent in March as a good chunk of its aircraft fleet remains grounded. “We can obviously evaluate a good partnership but it does not mean that we are out to sell ... Indian aviation is getting a lot of traction, and there are some reports that some airlines, some entrepreneurs are looking at (investing in the airline segment), that is why we are happy to look at ( any investment proposal,” the source told PTI.
"But if somebody asks us whether we are open for partnerships, that we can evaluate when it comes to us. But it does not mean that we are on the bloc,” he said. Earlier domestic aviation was constrained because of various factors including Covid-19 and fuel prices, among others, but after October last year things are much better with a better yield and load factor, he added.
"The promoters, in fact, are adding more equity. As much as Rs 300 crore are being infused from their side and funds to the tune of Rs 300 crore have to come from the banks, which have been sanctioned to us under the Emergency Credit Guarantee Line Scheme. So the airline should be able to get the entire Rs 600 crore amount in the next 3-4 weeks,” the source said.
The capital infusion in the airline from time to time has ensured that the airline is not only up and running but it expands the fleet as well. The airline is operating only with 36-37 aircraft at present as 25 of its Airbus A320Neo aircraft are grounded, the source said, adding that 180 GTF-powered aircraft of various airlines are grounded globally, awaiting engines.
"We have got 18 engines—17 in December (which made the airline recover eight aircraft) and one in March. We are expecting two more engines in April. We are still awaiting the final picture and the balance supply of March is expected to be delivered to us in May," he said. The engine maker was earlier supposed to deliver 20 engines to Go First by March.
The airline as of now has a backlog of 50 engines, which if delivered to it will help it put 25 more aircraft back into operations, the source said. Moreover, Go First has added eight new aircraft in the last 24 months while the delivery of two aircraft, which was due, has been deferred, he said. According to him, “The FY 2023 losses of the airline are in the range of Rs 1,800 crore including Rs 800 crore notional losses due to accounting standards, while the actual cash outflow would be at Rs 1,000 crore.