Go First Bankruptcy: What Is Controversy With Pratt And Whitney Engines Which Led To Go First's Turmoil?

Go First became second airline in the country after Jet Airways to file for insolvency on Tuesday. The Wadia group-backed said it was forced to seek voluntary insolvency resolution proceedings due to "serial failure" of Pratt & Whitney engines resulting in grounding of 50 per cent of the fleet and is no longer in a position to continue to meet its financial obligations.

The latest move by the Mumbai-based carrier, which has been flying for more than 17 years, came after arbitration proceedings in Singapore and a suit filed in a US court seeking enforcement of the arbitration award last month.

In a detailed statement to PTI, Go First said it has been forced to apply to the National Company Law Tribunal (NCLT) because of the recurring and persistent issues with the GTF (Geared Turbofan) engines supplied by P&W.

Also, Pratt & Whitney has failed to repair those engines and/or provide sufficient spare leased engines as it was required to do pursuant to its obligations under the relevant agreements between them.

Promoters have infused funds worth Rs 3,200 crore into the airline in the last three years and out of the total amount, Rs 2,400 crore was injected in the last 24 months. An amount of Rs 290 crore was pumped in April this year.

"This brings the total investment in the airline since its inception to approximately Rs 6,500 crore," the statement said.

A day after Go First filed for insolvency proceedings and cancelled flights citing non-availability of P&W engines, the US-based engine maker on Wednesday said it is complying with the arbitration order regarding the airline and continues to prioritise delivery schedules for all customers.

Meanwhile, Pratt & Whitney (P&W) claimed that Go First has a “lengthy history of missing its financial obligations” to the engine maker, news agency PTI reported citing a source.

"Pratt & Whitney is committed to the success of our airline customers, and we continue to prioritize delivery schedules for all customers. P&W is complying with the March 2023 arbitration ruling related to Go First. As this is now a matter of litigation, we will not comment further," PTI report said citing a statement by the company.

Go First had also said that if P&W had followed the directions laid down in the award, Go First would have been able to return to full operations by August/September 2023 leading to the airline's financial rehabilitation and survival.