The Principal Bench of the National Company Law Tribunal (NCLT), Delhi will take up the insolvency petition filed by Go Airlines today. Go airlines on Tuesday filed for voluntary insolvency proceedings citing operational losses caused due to ever-increasing failure of Pratt & Whitney engines that power its fleet.
The NCLT will hear the petition under section 10 of the Insolvency and Bankruptcy Code, under which a corporate body can voluntarily initiate an insolvency resolution process. Once the plea for insolvency resolution is admitted, the bench will appoint a resolution professional to take over the affairs of the company.
A day earlier, Go Air said it has grounded 25 aircraft as of May 1 due to 'failing engines' supplied by Pratt & Whitney's International Aero Engines. This translates into around 50% of its Airbus A320neo fleet. The airline said that the grounding of about half of its A320 neo fleet due to the 'serial failure' of Pratt & Whitney engines has cost it ₹10,800 crore in terms of revenues and expenses.
"The percentage of grounded aircraft due to Pratt & Whitney's faulty engines has grown from 7% in December 2019 to 31% in December 2020 to 50% in December 2022. This is despite Pratt & Whitney making several on-going assurances over the years, which it has repeatedly failed to meet," the Wadia Group-owned budget carrier said in a statement.
The airline also maintained that it was forced to apply to the NCLT after engine supplier Pratt & Whitney refused to comply with an award issued by an emergency arbitrator appointed by the Singapore International Arbitration Centre (SIAC). That order directed Pratt & Whitney to release and dispatch without delay at least ten serviceable spare leased engines to Go First by April 27, 2023, and a further ten spare leased engines per month until December 2023.
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