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SpiceJet cancels 12 flights today after DGCA grounding; FAA says reviewing data

On Tuesday, India banned operations of Boeing 737 MAX plane after this week’s Ethiopian Airline crash

, ET Bureau|
Updated: Mar 14, 2019, 08.18 AM IST
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The airline said that a majority of passengers affected as a result of these cancellations have been accommodated on alternate flights and the rest have been offered a full-refund.
Air fares are set to rise further as India’s ban on Boeing 737 Max planes will add to a spate of cancellations that has seen domestic tickets getting more expensive lately. The move will hit SpiceJet the hardest as it means 12 of the carrier’s planes will be grounded, disrupting its expansion plans.

The Directorate General of Civil Aviation (DGCA) decided late on Tuesday to stop flights by the planes in the wake of the Ethiopian Airlines crash, joining China, the UK, Germany, France and others. The US has taken no action, saying the plane is safe and it’s still reviewing details from the crash on Sunday and the one last year in Indonesia when a Lion Air 737 Max went down.

The move is expected to lead to a double-digit increase in airfares, which are already high compared with the same period last year thanks to the grounding of Jet Airways planes, including all five of its 737 Max planes because it hasn’t paid lessors. The cash-strapped carrier has also withdrawn flights in order to conserve cash. The country’s biggest carrier IndiGo has cancelled flights because of pilot shortages.

“At least 50 planes are out of action or grounded on the domestic front owing to multiple reasons. That is a significant reduction in domestic airline capacity,” said Sharat Dhall, chief operating officer, B2C, at Yatra, an online travel agency. “The additional capacity coming in is not likely to cover this in the short term, while demand is going to be robust over the next few months because of the school holidays and surging leisure travel.”

SpiceJet cancelled 14 flights on Wednesday andthe government said it will cancel 35 more on Thursday. DGCA asked it to stop all its 737 Max flights at 4 pm on Wednesday. Apart from the five Max planes, another 50 Jet Airways aircraft have been grounded because lease rentals haven’t been paid. SpiceJet and Jet Airways are the only two Indian carriers with 737 Max planes.

SpiceJet has 205 Boeing 737 Max planes on order and had planned to induct eight more into its fleet by the end of March. The flight ban will mean its plan to launch flights to the Middle East, a lucrative sector for Indian carriers, is likely to take a hit. The airline is working on a plan to ensure that the impact on flights and the expansion plan is minimised.

“We are trying to fly our Boeing 737 NG aircraft more to make up for the loss of 12 aircraft in our fleet,” he said, adding that covering the gap won’t be easy. However, it doesn’t expect to sustain losses due to the grounding as the revenue drop will be compensated by the aircraft manufacturer.

“The shortage of planes and high seat occupancies are expected to push airfares north in the short term,” Dhall said. “The airfares were at least 15% higher this year compared to last year, and owing to the current situation, airfares are expected to rise further this season.” The aviation ministry has called on airlines to not take advantage of the situation and raise fares. A check on Yatra showed that fares on the Delhi-Mumbai sector, about Rs 9,500 on Wednesday, were at Rs 11,000 for Thursday and Friday.

The situation is likely to persist with no clear timetable for the resumption of 737 Max services. “Basis information till now, the groundings are set to continue till the time the aircraft maker assures us that the aircraft is safe,’ said a senior DGCA official. “A review will now be taken after the preliminary report on the Ethiopian Airlines crash is out.” Jet Airways, which is in the midst of finalising a rescue plan, has 225 Boeing 737 Max planes on order and had planned to induct six planes by the end of the month.
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