After two months of price cuts, the state-run oil companies on Friday hiked aviation turbine fuel (ATF) price by a steep 6.5 per cent in step with hardening international rates.
Currently most of its 119 planes have been taken back by the lessors and many have been leased to other airlines like SpiceJet. The second challenge is that it has to repay banks.
According to a calculation by the government, India's airlines currently have 633 aircraft of which they may operate only 200.
'Ajit Doval said, "They are threatening us now".'
Rising crude oil prices and muted passenger traffic in the July-September quarter (second quarter, or Q2) of 2023-24 (FY24) have raised concerns about the profitability of listed aviation players. These two concerns have caused the stock of InterGlobe Aviation (IndiGo), the largest player in the sector, to slip by 11 per cent since its highs at the end of July. Nuvama Research expects yields to cool down in the near term due to seasonality, rising crude oil prices, and higher capacity.
Of the total outstanding of Rs 4,064.77 crore, a sum of Rs 2,571.73 crore (Rs 25.71 billion) is overdue payment, the Rajya Sabha was informed on Tuesday.
Vijay Mallya-owned Kingfisher Airlines owes state-run oil companies over Rs 950 crore (Rs 9.50 billion0 in unpaid fuel bills while financial crisis-hit NACIL has cleared almost two-thirds of its outstanding.
Replying to questions on losses to Air India, civil aviation minister Praful Patel said the rally in international crude oil prices that touched $147 a barrel in July 2008, hit Indian carriers by Rs 10,000 crore (Rs 100 billion) in jet fuel bill. Air India loses are a result of high jet fuel prices and fall in air traffic following global economic slowdown, he said. "There are (also) systematic issues which need to be corrected."
The GST rate is 5 per cent and 12 per cent on economy and business class tickets, respectively
Indian Oil, Bharat Petroleum and Hindustan Petroleum raised avitation turbine fuel price by Rs 3,949 to Rs 36,252 per kilolitre in Delhi effective Monday midnight, an IOC official said. International crude oil prices have firmed to a seven-month high of $72 per barrel on hopes of demand revival in US.
Recent attempts to salvage the situation might not be enough thanks to the rise in jet fuel prices and depreciation of the rupee.
With declining jet fuel prices, Air India has once again taken the lead in introducing further cuts in its fares on key domestic routes, which may lead to another round of 'fare war' among domestic carriers, including the no-frill ones.
Govt may grant infrastructure status to the aviation industry to enable it to access finances at cheaper rates
Jet Airways -- which has been flying for 25 years - on Friday described reports that the airline cannot fly beyond 60 days as "incorrect and malicious" as well as denied any talks of stake sale.
AI rejigged about 30 flights on its domestic and international sectors.
Since international oil prices have fallen, the government's subsidy payout will fall by almost Rs 50 per cylinder to Rs 240.
Weighed down by surging jet fuel prices, Air-India's net profit plunged by a huge 82.54 per cent at Rs 16.29 crore (Rs 162.9 million) for the year 2005-06.
State-run oil firms on Thursday cut aviation turbine fuel (ATF) or jet fuel prices by 4.3 per cent in view of halving of the customs duty on the fuel to five per cent. From today, ATF in Delhi will cost Rs 66,226.66 per kilo litre, down Rs 3,000.42 per kl, while in Mumbai the price has been cut by 4.36 per cent to Rs 68,626.87 per kl, an Indian Oil official said.
The increase in prices of jet fuel by about nine per cent would put an additional burden of Rs 550 crore (Rs 5.5 billion) on national carrier Indian and the airline has asked the government to consider levying a fuel surcharge on air travel or hiking
DGCA has told the airline that only "air worthy" aircraft, which are completely fit for flying, should be used in operations.
Cash-strapped domestic airlines have asked the government to declare the civil aviation sector as 'core infrastructure' and rationalise taxes and duties on jet fuel, equipment, services and other items.
After eight successive price cuts, state-run oil firms on Thursday raised jet fuel prices by 3.4 per cent reflecting increase in international oil prices.In Mumbai, the home for nation's busiest airport, ATF price will rise by Rs 1,068.87 to Rs 32,447.65 per kl.
Indian airline SpiceJet Ltd said on Thursday that its billionaire owner, Kalanithi Maran has proposed to transfer majority ownership in the ailing carrier to co-founder Ajay Singh.
"Air India is unable to pay even after a 90-day credit period. They owe us about Rs 300 crore without interest. There is also no bank guarantee from Air India to any of the oil marketing companies. We do not know when will the company honour its dues," said a BPCL official on condition of anonymity.
Naresh Goyal, after being ousted with his wife from the board last week, and with his shareholding halved to 25 per cent, can still make a comeback by partnering a new investor and win back majority control.
With fewer passengers airlines bracing for a rise in operating costs due to a spike in crude prices
Of the Rs 6,000 crore received in 2012-13, the airline spent Rs 1,803 crore (Rs 18.03 billion) on pending staff salaries, paid off Rs 1,253 crore (Rs 12.53 billion) as jet fuel dues to oil marketing companies and Rs 1,100 crore (Rs 11 billion) as loan and interest payments for aircraft acquired, official data showed.
Oil and Natural Gas Corporation will set up a specialised trading desk in India to market crude oil received from investments in oil fields abroad and surplus petroleum products from subsidiary Mangalore Refinery Petrochemicals Ltd.
Protesting non-payment of their salary and allowances, a section of Air India pilots are likely to stay off work on Saturday as part of a "no-pay-no-work" agitation.
Govt says domestic carriers' financial health a concern.
Though June-quarter performance was impressive, fuel price hikes and falling demand pose fresh challenges for the company.
Though SpiceJet is likely to resume flights, experts have a doubt on the airline's financial capabilities.
Oil companies have slashed Aviation Turbine Fuel (ATF) prices by Rs 2,221 per kilo litre with effect from midnight on Wednesday.
A subsidised 14.2-kg cylinder will now cost Rs 425.06 in Delhi as against Rs 423.09 previously, according to State-owned oil firms
On March 14, a Russian Su-27 jet collided with a US MQ-9 Reaper drone over the Black Sea.
It carried more than five million passengers across various sectors registering a growth of 20 per cent.
Boeing Corp. will on Sunday roll out its latest offering - the Boeing 787 Dreamliner - billed as the most economical and fuel efficient jet that will soon make its debut in India with top airlines Air India and Jet Airways placing orders for 37 jets.
A consortium of 26 lenders led by the SBI, with 51 per cent stake in the debt-trapped airline, has invited bids from potential suitors.
Jet Airways returns to profit after seven straight quarterly losses
