Guwahati, May 3: Go First, owned by the Wadia Group, filed for involuntary solvency on Tuesday, marking the first major airline collapse in India since Jet Airways in 2019.
Several flights were cancelled without any notice much to the frustration of passengers although Go First has promised to refund the ticket expenses to passengers.
The airline's notice read: "We regret to inform that due to operational reasons, Go First flights scheduled for 3rd, 4th, and 5th May 2023 have been cancelled. We apologise for the inconvenience". It further added that a full refund will be issued to customers via the original mode of payment soon. Customers are advised to stay in touch with the airline's customer care centre for updates on their flight and ticket refund status.
Go First is facing a severe cash crunch since it grounded over half of its fleet due to troubles with Pratt & Whitney engines. Go First, formerly known as Go Air, has been running daily operations with 28 aircraft out of the aircraft's 57 fleet.
The airline reported a net loss of $218 million in FY22, according to regulatory filings. This was twice as much as the previous year's loss of $105 million.
The airline owes its financial creditors $798 million, as per its bankruptcy filing accessed by Reuters. Go First's financial creditors include Central Bank of India, Bank of Baroda, IDBI Bank, Axis Bank and Deutsche Bank.
The bankrupt airline said it has not defaulted on any of these dues. "However, considering the present financial situation of the corporate applicant, defaults to financial creditors would be imminent," the filing read.