SpiceJet needs a way out of its financial crisis. The airline is far from being done, but it is in a very tight financial situation. According to some reports, SpiceJet is looking for expanding its international flight services. But the issue remains that it does not have a wide-body aircraft which can fly long-haul flights. To invest in a wide-body aircraft by purchasing it seems like an unlikely option for SpiceJet. That is why SpiceJet is reportedly looking to get an Airbus A330 aircraft in a wet-lease deal. It will be an interesting move from the airline given that it does not have a lot of cash liquidity.
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SpiceJet Wet Lease Deal To Get Airbus A330 Aircraft
SpiceJet is planning on getting an Airbus A330 aircraft in a wet-lease deal. For the unaware, a wet-lease deal is one where the airline leases the aircraft from the other party, but with that also gets an operating crew for the aircraft and fuel in some cases. SpiceJet plans to use this wide-body aircraft for international charters.
At the moment, passengers don’t get a non-stop flight for most of the major international destinations from India. The reason is that destinations are too far. Adding to that most of the Indian airlines don’t have an aircraft which can fly the distance in one go. That is why SpiceJet is looking to jump into the space of international charters.
With the Airbus A330, SpiceJet will be able to fly passengers in long-haul flights to far destinations. But the only issue is the cost that the wet-lease will come with. For wet-leasing a wide-body aircraft in India, it costs Rs 2 crore daily. These costs include the crew expenses and the rent of the aircraft. Indian aviation environment is still not offering the right cost to airlines for their growth.
CRISIL (a rating agency) downgraded SpiceJet recently. The airline has a very bad liquidity condition. For it to spend so much on a wet-lease would be a huge risk. It will be interesting to see what the airline ultimately decides.
