IndiGo has grounded 30 aircraft due to global supply chain disruptions. It amounts to around 10 per cent of its fleet. To avoid disruption, the airline is looking at wet leasing of aircraft.
The low-cost carrier said that the aviation industry is facing significant supply chain disruptions globally. “While it is our immediate priority to deploy adequate capacity to serve our customers, we are actively engaged with our OEM partners to work on mitigation measures that should ensure the continuity of our network and operations. As we work on various cost-efficient countermeasures with our OEM partners, the endeavor is to minimise the economic impact of around 30 AOG, resulting from this global disruption.”
In order to minimise the impact, IndiGo said it was evaluating slowing down re-deliveries through lease extensions, exploring the re-induction of aircraft into the fleet, and wet lease options to mitigate the disruptions. Last week, IndiGo declared its quarter results for Q2. Its net loss widened to ₹1,583 crore in the quarter ending September 30, 2022, from the year-ago-period when it stood at ₹1,436 crore.
Losses came primarily on account of an over 200 per cent increase in fuel costs year-on-year and increased forex loss. Other costs, apart from fuel, went up by 56 per cent y-o-y, too.
During an earnings call with analysts, Pieter Elbers, CEO IndiGo, had said supply-chain disruption in aircraft manufacturing and subsequent shortage of spare engines worldwide have impacted the airline’s operations due to the grounding of aircraft.
“One of the key after-effects of the pandemic in the aviation industry are the supply -chain disruptions in aircraft manufacturing and subsequent shortage of spare engines worldwide. This has affected our operations due to grounding of aircraft and has impacted our ability to fully deploy capacity productively,” he had said addressing the issue.
However, “we are looking at various options to mitigate the shortfalls in our capacity deployment such as slowing down the redeliveries, exploring introduction of aircraft into the fleet and adding capacity on ACMI basis”, he had said.
IndiGo has 279 aircraft in its fleet, which operate more than 1,600 daily flights and flies to 100 destinations, including 26 international ones
“We are bullish on the market opportunities and will continue to add flights in existing and new markets,” the spokesperson added.
ICICI Securities, in a report, said that post-Covid, there have been supply-chain disruptions in aircraft manufacturing and subsequent shortage of spare engines worldwide. This has affected IndiGo’s operations due to grounding of aircraft, and has impacted its ability to fully deploy capacity productively. “We had seen major escalations in supplementary rentals in FY20 due to extension of lease periods. As such, this is a concern,” it added.
Published on November 7, 2022
