Rs 238 cr quarterly loss for SpiceJet with grounded fleet, weak demand

Low-cost airline SpiceJet has reported a net loss of Rs 238 crore for the quarter ending 30 June, as the carrier continues to grapple with mounting operational challenges, including grounded aircraft, supply chain delays, and weak passenger demand in key markets.

The first-quarter results mark a significant downturn for the airline, which posted a profit of Rs 150 crore during the same period last year. The airline’s total income for the April–June quarter of the 2024–25 financial year fell sharply to Rs 1,190.56 crore, compared to Rs 2,067.21 crore in the corresponding quarter of the previous year, according to a regulatory filing made by the company.

In a statement issued after announcing its results, SpiceJet noted that its performance was adversely affected by a range of external factors. “The results were significantly impacted by the geopolitical situation with a neighbouring country and airspace restrictions in key markets, which led to subdued leisure travel demand,” the company said.

The airline also highlighted the continued grounding of several aircraft due to global supply chain disruptions and engine overhaul challenges as further contributing to its poor performance during the quarter. “The delay in returning grounded aircraft to service, owing to global supply chain disruptions and engine overhaul challenges, further compounded the situation,” the airline added.

SpiceJet chairman and managing-director Ajay Singh acknowledged the scale of the challenges in a statement. “This quarter's results reflect the extraordinary challenges faced by the aviation industry, including geopolitical turbulence, restricted air routes, and supply chain disruptions,” Singh said.

He added that the airline is taking 'decisive steps' to stabilise its operations, enhance fleet reliability, cut down on operational costs, and expand its network to better serve passengers and improve revenue streams.

As part of its ongoing recovery efforts, SpiceJet is reportedly in discussions to bring in additional aircraft under damp lease arrangements. In a damp lease, the aircraft and maintenance are provided by the lessor, but the crew and insurance are the responsibility of the lessee.

Such arrangements offer more operational flexibility and can help improve fleet availability without significant capital outlay.

Despite the challenging quarter, there was some improvement in the airline’s financial indicators. SpiceJet’s net worth, which had been in negative territory a year ago, has now turned positive. According to the latest figures, net worth stood at Rs 446 crore as of the June quarter, compared to a deficit of Rs 2,398 crore during the same period last year.

Industry analysts say the positive net worth is a modest sign of stabilisation, but the airline will need to achieve consistent revenue growth and resolve aircraft availability issues to return to sustained profitability.

However, SpiceJet continues to lag behind its competitors in terms of market share. According to data released by the Directorate General of Civil Aviation (DGCA), the airline held just a two per cent share of the domestic passenger market in July. This is significantly lower than rivals such as IndiGo, which dominates the sector, and newer entrants like Akasa Air, which are gradually expanding their footprint.

The broader aviation industry in India has also been facing pressure due to volatile fuel prices, regulatory changes, and operational uncertainties linked to global geopolitical developments.

Airlines have had to navigate increased operating costs alongside fluctuating passenger demand — particularly in the leisure travel segment, which remains sensitive to both pricing and international travel restrictions.

With PTI inputs