India’s aviation safety regulator placed SpiceJet under enhanced surveillance on a day when the cash-strapped airline’s passengers were once again barred from checking-in for their flights at Dubai airport over delayed payments.
The move by the Directorate General of Civil Aviation (DGCA) will entail increased spot checks as well as night surveillance to ensure that the airline’s poor financial health does not impact flight safety, a senior DGCA official said. He added that a special audit of the airline’s engineering facilities was also conducted on August 7 and 8, revealing “certain deficiencies”.
Also read: SpiceJet shares slump over 6% as DGCA places carrier under enhanced surveillance
The standoff at Dubai airport forced the airline to cancel some of the 11 flights it operates to Dubai daily, and fly empty aircraft back to India.
Flying empty
Industry sources said that the cancellations were due to delayed payments to ground-handling service provider Dnata, which told SpiceJet that they could either provide passenger facilitation or fuel. Since the airline wanted to utilise the aircraft for other flights as well, it decided to fly the aircraft back into India in an empty state.
“Due to operational reasons, a few SpiceJet flights from Dubai were cancelled. Affected passengers have been accommodated on subsequent SpiceJet flights, on other airlines, or provided with a full refund,” SpiceJet said in a statement, adding that all its flights from Dubai were now operating as planned.
Centre “monitoring” airline
The airline’s passengers at Dubai have been affected on multiple occasions in the recent past, but people in the know said these incidents had become more common over the last week.
Commenting on the Thursday incident, a senior official of the Ministry of Civil Aviation said: “We are monitoring SpiceJet.” The official added that the airline was going through a “challenging time”, referring to its poor financial health.
On August 12, 2024, Mumbai airport had also issued an advisory to SpiceJet’s passengers about a likely disruption to their flights. The advisory was later withdrawn. Most domestic airports have placed SpiceJet under cash-and-carry restrictions, to ensure that the airline pays its dues in advance before flight departure is permitted.
Delayed salaries
Meanwhile, the airline also placed 150 cabin crew on leave without pay after failing to pay salaries to most employees for the last two months. In Guwahati, nearly 80 loaders, drivers, and cleaners refused to report for duty for the second day in a row on Thursday, and held a demonstration outside the airport to protest the delay. Later in the evening, the airline released July’s salary for some of them.
“Some of my colleagues are surviving only on a cup of tea. We earn a meagre ₹15,000 per month which the airline is unable to pay us. Many of us haven’t been able to pay rent to our landlords,” said one staff member from Guwahati on the condition of anonymity.
Another staff member from Bengaluru who works in the SpiceJet’s security department described a similar ordeal. “Many of us are surviving only on one meal a day. There are daily threats from our landlords to pay rent. My family is particularly vulnerable because I have a two-month old child, and therefore, I asked my wife to mortgage her jewellery to be able to pay ₹7,000 to the landlord,” he said.
Engineers take delivery jobs
Another senior engineer wrote to The Hindu about his junior colleagues being forced to work as delivery agents with Swiggy and Zomato to make ends meet.
Pilots and cabin crew too were last paid salaries for the month of June, the airline said, in response to a questionnaire from The Hindu.
There are also concerns over the airline failing to deposit its share with the Employees’ Provident Fund Organisation as well as the tax deducted at source with the Income Tax department for the financial year 2024-2025.
Dwindling fleet
Over the past year, several engine and plane lessors have also dragged SpiceJet to court, seeking its liquidation due to its failure to pay rentals. Earlier this month, the Delhi High Court ordered the airline to ground three engines leased from two French lessors — Team France 01 SAS and Sunbird France 02 SAS — because of its defaults in rental payments. Due to its inability to make payments to lessors as well as pay for maintenance and spare parts, the airline’s active fleet is now down to 23 aircraft, compared to nearly 120 planes pre-COVID.
Last month, the board of the budget carrier approved a proposal to raise up to ₹3,000 crore through a qualified institutional placement (QIP). While the airline had earlier announced plans to raise about ₹2,250 crore from a group of 64 investors, it could only raise ₹1,060 crore, as one of the primary investors eventually backed out.
