The civil aviation regulator on Tuesday asked beleagured low-cost carrier SpiceJet to submit a revival plan with details of how the carrier proposes to recapitalise itself and repay its dues by December 15.
A top civil aviation ministry official said that the airline must clear dues of about R200 crore to the Airports Authority of India (AAI) by Wednesday.
COO Sanjiv Kapoor and Sun Group CFO SL Narayan met the DGCA on Tuesday evening and have sought a meeting with aviation minister P Ashok Gajapathi Raju.
The airline also withdrew all bookings beyond 30 days after being warned by the DGCA on Monday that it would issue a show-cause notice for non-compliance of its order. A DGCA official said that the aviation regulator remains unconvinced about SpiceJet’s chances of survival. “There is no change in status. We have asked them for a concrete revival plan,” he said.
Incidentally, sources said that since the regulator is currently in the midst of an FAA air safety audit, it cannot be seen to go soft on SpiceJet as that may be viewed negatively by the auditors.
The government has ruled out any financial support to SpiceJet. “A SpiceJet official paid a visit to the ministry today (Tuesday). We have told them that we cannot support by giving any line of credit or further time to clear dues,” a government official said.
Given how the carrier has been late on payments to suppliers, the AAI may put it on the cash-and-carry mode week unless it furnishes bank guarantees of around R200 crore, sources said. That means SpiceJet will not receive any credit facilities and must clear all airport charges every time a flight takes off. SpiceJet officials had sought to defer airport charges by six to seven weeks but given the current position that may not be possible.
SpiceJet owes suppliers, including AAI, R1,600 crore, though it claimed on Sunday that the figure was “significantly less”. Of this, SpiceJet owes lessors around R700 crore.
Additionally, it is behind on salary payments largely for top employees who account for 15% of the total workforce. The DGCA is understood to have withdrawn 186 slots from the airline while the airline has cancelled 70 flights per day from a peak of about 345.