The shares of SpiceJet suddenly rose to 7.2 percent on Wednesday,20th March. This was their biggest percentage gain since December 18. The investors think the airline could take advantage of Jet Airways’ financial crisis.
SpiceJet last week was forced to ground its 12 Boeing Co 737 MAX 8 planes following safety concerns after the Ethiopian Airlines plane crash that killed 157 people. SpiceJet and Jet Airways are only 2 carriers in India to have type of aircraft. They have a total of 400 in number.
The airlines also operate the previous model, the 737-800 among other Boeing planes. This makes the majority of the Jet Airways fleet, and the airline is now operating only 41 aircraft. That means around two-thirds of its fleet is grounded for non-payment to lessors, maintenance or other reasons.
“Lessors are panicking as they haven’t been paid and if Jet goes for insolvency, their planes will be stuck in India, so many of them are chasing SpiceJet,”said Directorate General of Civil Aviation (DGCA).
As a result of this, there are many grounded planes that need to be covered. So many Jet Airways pilots and workers are joining up SpiceJet.
SpiceJet and Jet Airways did not give their consent yet. But Jet Airways shares dropped about 7 per cent on Wednesday since they have big financial crisis. Also, the pilots threatening to go on strike over unpaid salaries.
Therefore let’s see if SpiceJet can lease some of Jet Airways ground planes.