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MAX ban effect: SpiceJet allowed to import 2 planes

14-Mar-2019
MAX ban effect: SpiceJet allowed to import 2 planes

With the grounding of Boeing 737 MAX 8 planes, SpiceJet has been allowed to import two aircraft in the short term to help it with its operations, BS Bhullar, Director-General of Civil Aviation, said on Wednesday.

“Normally, short duration means three months. But the aircraft should be in by Friday,” Bhullar said. He, however, declined to say from where the aircraft are being imported.

HS Kharola, Secretary, Civil Aviation, said that SpiceJet has been asked to ensure that airports to which it has one flight do not go off the air map as a result of the grounding of their Boeing MAX aircraft. The government decided to ban the use of the Boeing MAX in and over Indian airspace from 4 p.m. on Wednesday. The ban comes in the wake of two crashes involving the aircraft in less than four months. On Sunday, an Ethiopian Airlines plane crashed killing 157 people on board.

SpiceJet, which has 12 operational Boeing aircraft, will be hit the hardest by the ban.

Jet Airways has five Boeing MAXs, but these have not been operational from before the ban.

SpiceJet confirmed that 12 aircraft from its fleet of 76 have been grounded as a result of the DGCA directive. In a statement, the airline said it cancelled 14 flights on Wednesday, but would operate additional services from Thursday.

The ban on the Boeing MAX aircraft coupled with the grounding of Jet Airways planes and the pilot shortage-hit IndiGo flights will see air fares head north.

Santosh Hiredesai, Research Analyst, SBI Cap Securities, feels that with SpiceJet not being allowed to operate the Boeing MAX, daily flight cancellations would jump by another 70-80.

Already, some 100 flights are being cancelled daily due to Jet and IndiGo issues. In the ongoing winter schedule, the number of daily domestic departures is around 3,200. “About 5 per cent cancellations should further drive the tightness in the market taking up fares/pulling down growth rates,” Hiredesai said.

He added that if the grounding continues for a prolonged period, it could erode SpiceJet’s profits. “Expect some compensation though from the original equipment manufacturer depending on the agreement,” he says.

Sharat Dhall, Chief Operating Officer (B2C), Yatra.com, feels that the shortage of planes and the high seat occupancy are expected to push up fares in the short term.

“The airfares were at least 15 per cent higher this year compared to last year, and owing to the current situation, they are expected to rise further this season,” he says.

Aloke Bajpai, CEO and Co-founder, ixigo, said both domestic and international fares for flights to and from Mumbai and Delhi have seen an average increase of 40-50 per cent.



Source :- Thehindubusinessline.com
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