GO FIRST, one of India's leading low-cost airlines, has filed for insolvency before the National Company Law Tribunal in New Delhi, citing the increasing number of failing engines supplied by Pratt & Whitney's International Aero Engines, LLC.
As of May 1, 2023, GO FIRST had to ground around 50% of its total fleet of aircraft due to the engine failures. The airline stated that it was forced to file the petition as its exclusive engine supplier, Pratt & Whitney, failed to comply with the award issued by an emergency arbitrator appointed in accordance with the 2016 Arbitration rules of the Singapore International Arbitration Centre.
The arbitrator directed Pratt & Whitney to take all reasonable steps to release and dispatch serviceable spare leased engines without delay to GO FIRST. However, the engine supplier failed to comply with the award, leaving GO FIRST with no choice but to file for insolvency.
Senior Advocate P Nagesh appeared before the Principal bench of NCLT on May 3, 2023, requesting the urgent listing of the petition. The Principal bench has acceded to the request and listed the petition for May 4, 2023, as the first item.
P Nagesh Sr. Advocate, along with Advocates Pranjal Kishore, Suhas Puthige, Akshay Sharma, and Shouryaditya, appeared for GO FIRST.
The airline's insolvency filing is a significant setback for the Indian aviation industry, which has already been grappling with the COVID-19 pandemic's impact on air travel. GO FIRST was one of the few airlines that managed to remain profitable despite the pandemic's challenges.
The insolvency proceedings will have a significant impact on GO FIRST's employees, creditors, and passengers. The airline has assured its customers that it will continue to operate its flights as scheduled and honor all bookings and refunds.
The insolvency proceedings will also have a far-reaching impact on Pratt & Whitney, which supplies engines to several other airlines globally. The engine supplier will have to answer tough questions on its quality control processes and customer service policies.
The aviation industry will be closely watching the developments in the GO FIRST case, which could set a precedent for similar cases in the future.