Jet Airways says five planes grounded due to scheduled termination of engine lease

Jet Airways says five planes grounded due to scheduled termination of engine lease.

Debt-laden Indian carrier Jet Airways on Wednesday denied its aircraft had been grounded by GE Capital Aviation Services (GECAS), after media reports raised further concerns over the airline’s ability to pay dues.

Jet’s troubles have been worsened by a rising debt-pile, amid intense competition in the Indian aviation sector and higher oil prices.

In the latest effort to save itself, the airline will now seek shareholder approval next month to convert existing debt into equity.

Representational image. Reuters.Representational image. Reuters.
Earlier in the day, media reports said that Jet had been asked by GECAS, the aircraft financing and leasing business of General Electric Co, to ground at least five Boeing 737 planes due to non-payment of dues.

Jet said in its statement that it had not ground any aircraft due to a notice from GECAS.

The airline is in the process of delivering three aircraft to lessors due to the scheduled expiry of lease terms, it said in a statement.

Jet added that three of its aircraft were temporarily grounded for engine normalisation, which is expected to be completed by Friday. Two others were on ground — one for scheduled termination of the engine’s lease and another for technical reasons.

Crisis talks between the airline and its lessors had failed to ease a row over late payments, prompting some lessors to explore taking back aircraft, three people familiar with the matter told Reuters earlier this month.

Meanwhile, Abu Dhabi-based Etihad Airways, Jet’s second-largest shareholder, is now in talks with creditors for a deal that could help the airline back on its feet.

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