Some of the apprehensions on Indigo’s performance being affected due to the Pratt & Whitney engines and the DGCA’s warnings on grounding the aircraft stand confirmed by the company itself officially. In a presentation to investors, the company has stated that its original plan, to increase capacity year-on-year by 30% this fiscal, may not happen now. The revised estimates are 15-22% for the last quarter of the financial year 2019-20 and for the entire year it may be 22-23%.
As already reported, the airline has had this ongoing problem of the P&W aircraft engines fitted on their Airbus A320NEO and A321NEO aircraft having a technical flaw in them and there have been frequent reports of the engines failing in the air. The DGCA took note of these ‘incidents’ and directed the airline to change the engines or get the modifications made in the engines to ensure safety of the aircraft and the passengers flying in them. The regulator even gave the option to change at least one engine on each of the operating aircraft to be fitted with the engines duly modified to remove the flaw. The time given was extended too.
The company says it has been working with P&W, the engine manufacturer and Airbus Industrie, the aircraft manufacturer and supplier in resolving the issue but the process is taking time.
The company is continuing to get new aircraft delivered by Airbus against its order and the new aircraft have no such issues with the engines. DGCA has therefore told Indigo to keep grounding one aircraft every time a new aircraft gets delivered.
Indigo says it is in full compliance of the directives of the DGCA.
As far as the financial performance figures are concerned, loss reported for the quarter ended September 2019 stood at ₹1,062 crore compared to ₹615.5 crore for the corresponding quarter the previous year. The company has said the profit for the next quarter Oct-Dec will not be very different from the ₹190 crore profit posted last year for the same quarter.
The airline has however assured the investors that many of the issues it is facing now will disappear by the summer of 2020. There was a bump in the employee cost by almost a fourth as it had absorbed 600 pilots from Jet Airways which shut down its operations in April this year.