Go First looking to raise more funds, resume services with fewer aircraft

Go Airlines India Ltd, the entity that operates Go First Airlines is looking to collect around Rs 600-700 crore and begin its services with fewer flights than originally planned, Mint reported.

"We have revised our original plan. We may resume flight operations with 10-15 aircraft but go for higher interim financing from the creditors," an unnamed person privy to the updates told Mint.

Previously, Go Air planned to begin its operations with 26 aircraft by making arrangements for Rs 400-500 crore from its lenders. However, now the airline is considering keeping some cash in its hands and starting its operations with fewer aircraft.

Go First has taken loans of about Rs 6,521 crore from its creditors which include Central Bank of India Ltd, Bank of Baroda Ltd, IDBI Bank Ltd, and Axis Bank Ltd, among others.

Engine supplier Pratt & Whitney has agreed to provide 4-5 engines and allied services every month to Go Air after the Singapore International Arbitration Centre (SIAC) directed the engine maker to do so, the report said.

The people cited above told Mint that the new plan to access more funds aims at relaunching flight operations with better infrastructure, ensuring smooth payment of the fresh lease rentals, and better salaries for pilots, crew, and other staff.

The report said that the Directorate General of Civil Aviation (DGCA) wants the airline to ensure that there are enough pilots.

Go First filed for the initiation of insolvency proceedings in May 2023 as the airline struggled with engine issues which had resulted in the grounding of a large number of its aircraft.

Grounding of aircraft resulted in Go Air's market share crashing from 11 per cent in November 2019 to 6.9 per cent in March 2023.