SpiceJet Cancels Over 1,800 Flights in Domestic Sector
Posted On : 2014-12-08 17:03:26
News Type: Country ;
Cash-strapped SpiceJet has cancelled over 1,800 flights across the country for the current month, in signs of mounting troubles for the budget airline.
The air carrier, which is part of Kalanithi Maran-led Sun Group, has cancelled a total of 1,861 flights, a few to Kathmandu in Nepal and all others connecting domestic cities, till December 31, SpiceJet said in an update on its website.
These included 81 flights scheduled for Monday.
The large-scale flight cancellations came at a time when the aviation regulator DGCA was considering issuing a show-cause notice to the airline for defying its directives regarding advance bookings.
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DGCA has asked the airline to stop taking bookings by tomorrow of more than one month in advance.
Besides, Airports Authority of India (AAI) is said to be considering putting SpiceJet on cash-and-carry mode soon if it does not furnish a bank guarantee against its dues to the airport operator, which stand at around Rs. 200 crore.
While the regulatory actions might not immediately impact the airline s licence, it could force "a series of actions".
Concerned over the deteriorating condition of SpiceJet and large-scale flight cancellations, DGCA had on Friday also withdrawn 186 of its slots and asked it to clear salary dues of all its employees within the coming 10 days.
Shares of SpiceJet, which tumbled 13 per cent in early trade today amid a flurry of negative news including fund drought and large-scale flight cancellations, closed with a loss of 4.39 per cent at Rs. 15.25 apiece.
Union Civil aviation minister Ashok Gajapathi Raju also last week raised serious concern over the financial health of the domestic airline.
"We are running through a lot of turbulent weather...not only the public sector, private sector is also crashing. (With) Kingfisher crashing and, right now, SpiceJet seems to be giving us heart attacks as far as airlines are concerned," Raju had said.
Experts said that SpiceJet needs to act fast to avoid problems like Kingfisher, which had to be grounded amid growing financial burden.
SpiceJet reported fifth straight quarter of net losses for the July-September period at Rs. 310 crore.