Low-cost carrier GoFirst may be forced to ground 8-12 more aircraft in the next 6-12 months if Pratt & Whitney does not fulfill its contractual obligations and provide the airline with spare engines.
GoFirst and Pratt & Whitney have reached a deadlock when it comes to negotiations about the former's PW-1100G geared turbofan (GTF) engines in the last few months, with GoFirst looking to sue the engine maker over its grounded aircraft.
GoFirst is looking to sue Raytheon Technologies, the parent company of Pratt & Whitney, and will seek compensation for the loss of business due to its grounded planes.
"Pratt & Whitney is not fulfilling its contractual obligations to GoFirst. The engine maker is refusing to repair its faulty engines free of cost and has also stopped compensating GoFirst for grounded aircraft," said an official aware of the ongoing discussion.
He added that GoFirst has around 23-24 aircraft grounded at the moment and P&W is holding the airline "at ransom" while refusing to provide the airline with spare engines.
In 2019, Go First signed a deal to buy PW engines for its 72 A320neo aircraft along with a comprehensive service agreement that mandated compensation from the engine maker for any maintenance issues.
"GoFirst has received 8-9 spare engines from P&W till now and the engine maker has refused to provide any more spare engines to the airline," a second official said.
He added that P&W has asked GoFirst to pay for the repair of faulty engines, despite being under contract to repair them free of cost.
"P&W has asked GoFirst to pay a full-service fee to repair the faulty engines," the first official said.
Emails sent to GoFirst and PW remained unanswered at the time of publishing.
The officials added that over the last 24 months, GoFirst has been forced to ground its aircraft due to faulty P&W engines.
“Over the last two years, P&W engines have had an average lifespan of 6,000 hours which is lower than the expected lifespan of 15,000 hours from the engines. This has resulted in GoFirst being forced to ground it aircraft," the second official said.
Last month, Raytheon Technologies said that the availability of complex metal components used to produce aerospace turbofans will likely remain constrained through most of 2023.
More than 50 aircraft of Go First and IndiGo had been grounded due to a lack of engines and spare parts in November. P&W provides engines to about 200 Airbus A320neo aircraft flown by Go First and IndiGo.
Its engines also power turboprop aircraft such as the ATR-72 and Bombardier Q-400 flown by Alliance Air, IndiGo, and SpiceJet.
Both airlines had to ground their aircraft due to delays in engine deliveries on account of significant supply chain disruptions, according to reports in November. IndiGo has gone down the leasing route to meet demand, while Go First is struggling to meet capacity and maintain its schedule.
In November, senior P&W executives including president Shane Eddy and Rick Deurloo, president of the company’s commercial engines division, met top officials of Go First and IndiGo to discuss ways to resolve engine supply issues in India. The executives said P&W is working aggressively to address the supply chain disruption and would be in much better shape by the end of 2022.
P&W's geared turbofan engines have faced technical problems since 2016, even causing a number of in-flight shutdowns.
Back in 2019, India's aviation regulator Directorate General of Civil Aviation (DGCA) had mandated that Indian carriers will have to replace the faulty engines before inducting a new aircraft.
Earlier this month, Tata Group-owned Air India placed an order for 470 planes with Airbus and Boeing. However, P&W has not been chosen to supply engines for any of these aircraft and the engines are to be supplied by GE Aerospace, CFM and Rolls Royce.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!