India’s SpiceJet Ltd said on Thursday it expects Boeing Co’s grounded 737 Max jets in its fleet to return to service at the end of September following a settlement struck with lessor Avolon on leases of the aircraft.
Later that day, Directorate General of Civil Aviation (the country’s aviation safety regulator) announced it had given clearance for 737 Max to fly immediately after almost two-and-a half years of grounding.
After two deadly crashes that killed 346 people in just five months, the 737 Max was grounded around the world in March 2019. This plunged Boeing into a financial crisis which was further compounded by a pandemic.
Around 175 countries have allowed the 737 Max to return to service, with 30 airlines already restarting their Max aircraft services.
SpiceJet India, India’s second largest airline market share, stated that Max services will be resumed subject to regulatory approvals. It is also the only Indian company to fly this aircraft. Avolon did not respond to our request for comment.
SpiceJet, which said earlier this month it was in discussions with lessors of Max aircraft to restructure present leases, did not provide any further details on the settlement.
According to Likhita Chepa (senior research analyst, CapitalVia Global Research), there could be some lift-off in air traffic if travel restrictions are relaxed and vaccinations given at a faster pace.
Chepa said that higher ATF (Air Turbine Fuel), prices could impact margins and operateability.
SpiceJet stated that 13 of its 737 Max aircrafts were grounded and it was talking to Boeing about compensation for the losses and costs it suffered.
Boeing said that it continues to cooperate with international regulators in order to return the 737-8/737-9 safely to service. However, the planemaker declined to comment on compensation.
As of Thursday’s close, SpiceJet shares were down 25.1% compared with a 1.3% increase in shares owned by InterGlobe Aviation rival Indigo.
Reporting by Rama Venkat, Bengaluru. Editing by Vinay Dwivedi and Krishna Chandra Eluri.
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Publited at Thu 26 August 2021, 18:14.19 (+0000).