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Slowdown grounds business jets as the rich tighten purse strings

India Inc is looking to tighten its belt amid the economic slowdown as it gives up on jets.

, ET Bureau|
Updated: Dec 06, 2019, 08.44 AM IST
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NEW DELHI : Indian industrialists looking to tighten their belts amid the economic slowdown are giving up business jets as they cut the flab.

Anil Ambani’s Reliance Transport and Travels has leased one of its three business jets, a 13-seater Global 5000, to a global charter company that has stationed the aircraft in Bengaluru. “This is the same aircraft that Anil Ambani used to fly in for his travels,” said a person with knowledge of the matter. The company has two more fixed-wing planes and a helicopter in its fleet, according to a regulatory filing.

Others such as actor and entrepreneur Sachiin Joshi-promoted Viiking Aviation, Indiabulls-promoted Airmid Aviation and Religare-promoted Ligare Aviation are said to be facing financial stress and looking at selling their planes or have already done so.

The trend is reflected in the numbers: India had 99 nonscheduled operators (NSOPs) in September, down from 130 in a little over a year, according to Directorate General of Civil Aviation (DGCA) data.

“The decline has not stopped as there are a number of them who are in distress and may be looking to shut their business,” said a person aware of the matter.

Reliance Transport, Viiking, Indiabulls and Ligare did not respond to queries.

Joshi, who owns Goa Kings Beer and bought Vijay Mallya’s Kingfisher Villa in the western state in 2017, owns Viiking Aviation, which doesn’t have enough funds to service its two aircraft, according to people with knowledge of the matter. One aircraft is parked at Mumbai airport and the other at Nanded. The company hasn’t paid salaries in the past four months, the person said.

The cost of ownership is steep and includes pilots, crew and other support staff apart from parking and servicing. It’s cheaper to rent a private jet or a helicopter at about Rs 2.5 lakh per hour, depending on the size of the aircraft, experts said.

Indiabulls-promoted Airmid Aviation, which once had three business jets and one helicopter, now just has the latter.

“While they have returned the three aircraft, the helicopter is left with them because it is on lease to a state government and, hence, cannot be returned,” said the person cited above.

Ligare Aviation is said to be looking at selling the one aircraft that it has left.

General aviation aircraft movement fell 5.7% in September and 12.8% in October. That’s despite a number of flights under the regional connectivity scheme being included in general aviation movement numbers.

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