Despite the recent financial woes that have led SpiceJet to cut down fleet and operations, the airline’s scheduled delivery of 42 Boeing 737 Max aircraft, worth over $4 billion, remains intact with the first aircraft set to be delivered by the end of 2018.
“The order (by SpiceJet) very much holds even though the airline is working towards reducing debt and getting back to healthier finances,” Dinesh A Keskar, Boeing’s vice-president (sales) for Asia Pacific and India, said in a telephonic interview.
“Our track record is very good and not a single Boeing order has so far been canceled. We don’t expect SpiceJet to cancel or reduce their order,” Keskar added.
When asked about the status of the Boeing order, a SpiceJet spokesperson said the airline didn’t want to comment on the issue.
During the last two months or so, billionaire Kalanithi Maran-controlled SpiceJet has gradually reduced its Boeing 737 fleet size to 22 planes, down from the 37 it operated earlier this year. Salaries have been delayed and the airline has faced regulatory scrutiny, following a spate of cancellations aimed at cutting costs. The airline has also failed to get an external investor on board despite trying for the last two years.
Recently, the Directorate General of Civil Aviation (DGCA) barred SpiceJet from accepting bookings for travel more than a month in advance. According to a Bloomberg report, DGCA has also cancelled 183 of the airline’s landing and parking slots. However, Boeing is confident that recovery for SpiceJet is around the corner.
By cutting fleet size SpiceJet has reduced its monthly expenses on fleet lease significantly. It has started deploying its aircraft on most profitable routes, scrapping the loss-making routes, Keskar said. “We are obviously cautiously optimistic on SpiceJet,” he added.
Boeing’s Keskar said that as many as 2,500 orders for Boeing 737 Max aircraft have been placed with the company by various airlines and leasing companies. The first aircraft of this configuration, which is expected to roll out in 2017, will, however, reach SpiceJet only during the final quarter of calendar year 2018.