SpiceJet (SG, Delhi International) has not changed the status of its order for forty-two B737 MAX 8 jets the President of Boeing (BOE, Washington National) India, Pratyush Kumar, has said. Placed in March 2014, deliveries are still expected to commence in 2018 as the carrier seeks to return to profitability through an increase in its overall available seat capacity.
Immediate plans to increase its fleet from nineteen B737-800s to twenty-six by summer and thirty-three by the end of the year have been hindered by existing lessors unwillingness to extend leases with the carrier. Earlier this month, Ireland's Babcock & Brown Aircraft Management (BBAM) moved to repossess six B737-800s amid claims of USD100 million in unpaid leasing dues and MRO fees.
But, in the interests of protecting its airline industry, Bloomberg news last week quoted an anonymous government official as saying India would help Spicejet retain its fleet of aircraft despite the country being a signatory to the Cape Town Convention, which defines the rights of aircraft owners or lessors in the event of a default on payments, allowing them to repossess their equipment quickly if there is no resolution.
Lessors, which include the leasing arm of the Bank of China, BOC Aviation, are afraid of a repeat of the Kingfisher Airlines (Mumbai International) bankruptcy in 2012 in which the Indian government dragged its feet over the de-registering of Kingfisher-operated aircraft.
In other Spicejet related news, there are reports that the LCC is in talks with Bombardier Aerospace (BBA, Montréal Trudeau) over a proposed sale/leaseback agreement involving the airline's fleet of fifteen Dash 8-400s. The tentative deal would raise roughly USD96.5 million in added capital for Spicejet's operations. However, last week, India's Business Standard newspaper quoted an unnamed airline executive as saying Spicejet's new owners, Ajay Singh and Co., were still out on the future of the Q400s given that many of the airline's loss-making routes are operated with the turboprops. A decision is expected in the coming weeks.
