SpiceJet, the financially distressed Indian carrier, has been in the news for all the wrong reasons lately. The airline has been forced to curb its operations over time as it tries to stay afloat after all the legal troubles with lessors. The airline plans to initiate an INR 30 billion fundraising (USD 357 Million) through a Qualified Institutional Placement (QIP), which it expects to complete by the end of September 2024. It is currently circulated to shareholders for approval.
SpiceJet’s current troubles
SpiceJet, a Delhi-based low-cost airline, reported a profit after tax of INR 1.5 billion (USD 17.88 million) for the quarter ending June 2024. SpiceJet currently has negative retained earnings of INR 76,621.34 million (USD 913 million) and a negative net worth of Rs. 23,977.21 million (USD 285 million) as of the end of the June 2024 quarters.For reference sake, SpiceJet was once over 100 aircraft big and was India’s second largest no-frills carrier.
The airline is currently unable to pay salaries to many of its staff and July salary is unpaid for now. Here are some reports from people who cover SpiceJet more deeply than anyone else.
Really terrible condition of @flyspicejet unpaid employees
Airline yet to give even July's Rs 15000 to many loaders
This a mail from a group of staffers: pic.twitter.com/MoxZrAN3dw
— Saurabh Sinha (@27saurabhsinha) August 29, 2024
It is being reported that some of the ground staff, who are already underpaid, have not been paid for months and are forced to work with food delivery services to make ends meet.
Employee account of salary delays at SpiceJet for 2 months. Some forced to work as Zomato and Swiggy delivery agents on weekends to make up for the loss of income pic.twitter.com/h5HZq831LK
— Jagriti Chandra (@jagritichandra) August 28, 2024
A few weeks ago, SpiceJet was openly warned by Mumbai Airport to pay up, or their customers would face troubles. Now, reports are coming in from Dubai Airport that, for the fourth time in the past fortnight, they have had to stop SpiceJet from boarding passengers on the back of dues from their end.
The airline is also in contention for monies payable to the ex-owner of the airline and a tug-of-war between the airline and lessors about some engines.
Dwindling fleet, suffering reliability
SpiceJet, which on paper, has a fleet of 58 aircraft, is currently only operating 19 of these aircraft. Seems a large chunk of the fleet is grounded (both Q400s and Boeing 737 aircraft). Let’s have a look at the entire fleet:
- VT-SLA (Boeing 737-700, 17 years old): Operational
- VT-SLB (Boeing 737-700, 17 years old): Operational
- VT-SLP (Boeing 737-700, 15 years old): Parked at Delhi Airport since December 17, 2023
- VT-SYT (Boeing 737-700, 17 years old): Parked at Chennai Airport since December 12, 2021
- VT-SYU (Boeing 737-700, 16 years old): Parked at Delhi Airport since November 22, 2021
- VT-SGG (Boeing 737-800, 14 years old): Operational
- VT-SGJ (Boeing 737-800, 19 years old): Parked at Kolkata Airport since November 22, 2021
- VT-SGV (Boeing 737-800, 12 years old): Operational
- VT-SLF (Boeing 737-800, 18 years old): Operational
- VT-SLG (Boeing 737-800, 18 years old): Operational
- VT-SLJ (Boeing 737-800, 16 years old): Parked at Delhi Airport since June 27, 2022
- VT-SLM (Boeing 737-800, 16 years old): Operational
- VT-SXA (Boeing 737-800, 17 years old): Parked at Thiruvanthanapuram since August 19, 2024
- VT-SXE (Boeing 737-800, 17 years old): Operational
- VT-SYJ (Boeing 737-800, 20 years old): Operational
- VT-SYZ (Boeing 737-800, 17 years old): Operational
- VT-SLC (Boeing 737-900ER, 16 years old): Operational
- VT-SLD (Boeing 737-900ER, 16 years old): Parked at Chennai since April 23, 2022
- VT-SZL (Boeing 737-900ER, 15 years old): Parked at Delhi since October 11, 2022
- VT-MAX (Boeing 737-8, 5 years old): Operational
- VT-MXA (Boeing 737-8, 5 years old): Parked at Hyderabad since June 29, 2024
- VT-MXB (Boeing 737-8, 5 years old): Parked at Kolkata since March 14, 2024
- VT-MXC (Boeing 737-8, 5 years old): Last flight operated on July 24, 2024. In Jeddah since July 2024(per FR24)
- VT-MXD (Boeing 737-8, 5 years old): Parked at Hyderabad since August 6, 2024
- VT-MXE (Boeing 737-8, 5 years old): Parked at Delhi since June 9, 2024
- VT-MXI (Boeing 737-8, 5 years old): Parked at Hyderabad since July 27, 2024
- VT-SQA (Q400, 6 Years old): Parked at Chennai since August 22, 2024
- VT-SQB (Q400, 6 Years old): Operational
- VT-SQC (Q400, 6 Years old): Operational
- VT-SQD (Q400, 5 Years old): Operational
- VT-SQE (Q400, 5 Years old): Operational
- VT-SUB (Q400, 13 Years old): Parked at Chennai since August 3, 2023
- VT-SUD (Q400, 13 Years old): Parked at Delhi since July 25, 2023
- VT-SUE (Q400, 13 Years old): Parked at Mumbai since July 31, 2022
- VT-SUF (Q400, 13 Years old): Parked at Bengaluru since October 18, 2023
- VT-SUG (Q400, 13 Years old): Parked at Chennai since February 11, 2023
- VT-SUH (Q400, 12 Years old): Parked at Chennai since April 14, 2024
- VT-SUI (Q400, 12 Years old): Parked at Chennai since September 30, 2020
- VT-SUJ (Q400, 12 Years old): Parked
- VT-SUK (Q400, 12 Years old): Parked at Chennai since September 5, 2021
- VT-SUL (Q400, 12 Years old): Parked
- VT-SUM (Q400, 12 Years old): Parked at Chennai since February 2, 2021
- VT-SUO (Q400, 12 Years old): Operational
- VT-SUP (Q400, 12 Years old): Parked
- VT-SUQ (Q400, 12 Years old): Parked at Chennai since May 23, 2024
- VT-SUR (Q400, 14 Years old): Parked at Chennai since November 16, 2023
- VT-SUS (Q400, 7 Years old): Parked at Chennai since May 23, 2024
- VT-SUV (Q400, 14 Years old): Parked at Chennai since July 26, 2022 [Exited Fleet]
- VT-SUY (Q400, 14 Years old): Parked at Delhi since November 17, 2021 [Exited Fleet]
Wetleased aircraft
- PK-BBF (Boeing 737-800, 16 years old): Last flight operated on July 16, 2024
- PK-BBG (Boeing 737-800, 17 years old): Last flight operated on July 15, 2024
- PK-BBH (Boeing 737-800, 12 years old): Last flight operated on July 16, 2024
- XU-727 (Airbus A320-200, 14 years old): Operational
- XU-729 (Airbus A320-200, 14 years old): Operational
In the wake of their inability to fly existing aircraft, SpiceJet keeps on wet-leasing aircraft for short duration from other carriers. The airline has recently had four short-duration wet leases of A340 aircraft from Legend Airlines and 12 737-800/MAX aircraft from Corendon Airlines.
The airline has seen five of its 737-8 aircraft (VT-MXG/H/J/K/X) exit the fleet, and none of its remaining 737-8 aircraft on the Boeing order book are currently on Boeing’s production plans.
The number irate customers who end up booking SpiceJet flights keeps growing. As of August 28, 2024, SpiceJet only operated 52.5% of its flights on time domestically, as per the Indian Government, and as of July 2024, the airline had the highest cancellation rate reported amongst Indian carriers.
Bottomline
SpiceJet, once a 100-aircraft-strong airline, is now down to 19 operational aircraft, unpaid crews, and a mess of court cases. The airline’s operational reliability is subpar at the moment, and it is operating a whole bunch of aircraft with broken interiors as well.
Have you recently flown SpiceJet? What has been your experience with the airline?
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Passengers booking spicejet are really playing with Fire booking spicejet. Don’t blame anyone else later incase some untoward accident happens which takes your life
Flew sg 2yrs back and had horrible experience of all seats on my row being broken, this after them charging me for 500gms over weight on the cabin bag from dubai. Now I have a flight in the next 2 days and I’m not sure we can even fly as they seem to be grounded
Wonder what made you book spicejet out of all the options. I guess incase anything going wrong, the passenger is to blame now. Passenger chose to book the masala airline !
How can an airline that reported a profit of 150cr be on the brink of bankruptcy?
@Jk, not sure if you know that paper profits are not the same as cash in the bank. Plus, did you miss the massive negative net worth. The airline will have to recapitalise massively to wipe that negative networth.
Flew SG for the first time thinking it shouldn’t be that bad. Booked the first flight off BOM to DEL which was operated by an aircraft which overnighted at BOM so as to avoid any delay.
But boy, I was wrong. Still had a 2 hour delay, uninterested cabin crew (BTW, who would be even interested to work with delayed salaries) and such a bad aircraft which looked like AI’s old A320s from the original batch of early 1990s.