Sinking SpiceJet seeks government bailout

Hammered by losses and being pursued by the aviation regulator and the Airports Authority of India, SpiceJet approached the government for financial assistance on Monday to continue flying.

But the no-frills carrier, which has a burden of more than Rs 2,000 crore, got no assurance from the government.

Minister of state for civil aviation Mahesh Sharma told the media after meeting top SpiceJet officials, including chief operating officer Sanjiv Kapoor, and Sun Group's chief financial officer S.L. Narayanan, here, "No assurance has been given to them," adding that any such decision could only be taken at the highest level in the government. SpiceJet's request would be put up before the Prime Minister's Office and the ministries of finance and petroleum, Sharma added.

The meeting came hours after the airline's officials met Directorate General of Civil Aviation (DGCA) chief Prabhat Kumar and shared an operational plan, but official sources said that there was nothing new in it.

The regulator had given the airline time till Monday to release pending salaries of employees and submit a schedule on how it plans to pay vendor dues of about Rs 1,600 crore.

Kapoor and Narayanan refused to talk to reporters after their meetings with Sharma and Kumar.

Till date, SpiceJet has reduced flights across its network from 332 daily to 239 from September 1 till date, according to latest official figures. It has cancelled 1,861 flights till this month-end.

The airline, which had 48 aircraft-33 Boeing737s and 15 Q-400 regional jets-was operating only 35 of them-22 B737s and 13 Q-400s-considerably shrinking its fleet as it lost considerable amounts on a regular basis.

It has a 17 per cent market share. The airline has been losing money and promoter Kalanithi Maran, who owns majority stake in the airline, has already brought in about Rs 250 crore into the carrier this year but to no avail. The airline's total liability stands at more than Rs 2,000 crore and it needs, at least, Rs 1,400 crore immediately to keep it off the ground.