May 10 (Reuters) – Go Airlines (India) Ltd was granted bankruptcy protection on Wednesday, paving the way for the budget carrier to renegotiate debts and contracts after it grounded about half of its fleet, claiming that the Pratt & Whitney engines were defective.
Here are some details about the American manufacturer’s Geared Turbofan (GTF) engines, which Go First says are at the heart of the crisis.
WHEN DID THE PROBLEM START?
In 2016, Go First took delivery of its first A320neo aircraft powered by GTF engines after placing an order for 72 of the narrow-body aircraft from Airbus ( AIR.PA ). Pratt & Whitney is the exclusive engine supplier for the airline’s A320neo fleet.
Go First said it chose the engines because the US company, which competes with CFM International, offered better fleet management terms, and the engines would be more fuel efficient, quieter and require less servicing.
But the GTF engines, which Pratt spent $10 billion to develop, were found to have problems involving fan blades, an oil seal and combustion chamber lining.
Problems with the GTF engines grounded several A320neo aircraft in 2017, a year after the engine’s launch. In India alone, IndiGo and Go First, among the A320neo’s biggest customers, grounded up to 12 planes at a time and canceled dozens of flights.
WHAT HAPPENED AFTER?
Go First said Pratt & Whitney agreed in 2017 to compensate it for “engine support.” The agreement, which ran until 2019, provided unspecified compensation to the airline for days when planes were grounded with engines that needed to be replaced or repaired.
But in 2020, Go First began experiencing “more serious” engine failures and in 2022 financial disputes broke out between the two companies over the engine replacement and maintenance agreement.
In February 2023, Pratt proposed a plan to supply replacement engines at a rate “four times the failure rate”, prompting Go First to seek emergency arbitration in Singapore a month later.
Pratt’s lawyers said in the arbitration that its engines were not defective even if they had not performed as expected. The engine maker also said Go First’s financial problems were of its own making and the airline owed more than $100 million.
Go First said the number of planes due to “faulty engines” has risen from 7% of its fleet in December 2019 to 50% in December 2022, costing it 108 billion rupees (1.3 billion of dollars) in lost revenue and additional expenses.
Pratt said it was “committed to the success of our airline customers and we continue to prioritize delivery times for all customers.”
Greg Hayes, CEO of Pratt’s owner Raytheon Technologies Corp ( RTX.N ), said in February that the reliability of the GTF engines had not lived up to expectations and that the company was working to fix the problems.
IndiGo, India’s largest airline and a major A320neo customer, faces a similar problem with Pratt engines for part of its fleet, but has been able to better navigate the crisis in because of their much larger fleet and better vendor negotiations. to Jefferies analyst Prateek Kumar.
Reporting by Kevin Krolicki; Compiled by Miyoung Kim; Edited by Gerry Doyle and Edwina Gibbs
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