SpiceJet is gearing up to reduce costs and bolster investor confidence by implementing a workforce reduction. The airline, currently employing 9,000 staff and operating approximately 30 planes, intends to lay off 1,400 employees, constituting about 15 per cent of its workforce.
The aviation firm, facing a major financial crunch, has eight aircraft on wet lease from foreign carriers, along with their respective crew and pilots.
As per a report by the Economic Times, a spokesperson emphasized that this action aims to align the companywide expenses with operational needs. Insiders familiar with the situation stated that the airline's Rs 60 crore salary bill necessitated the staff reductions.
The aviation firm has been deferring salary disbursements for several months, with many employees still awaiting their January wages, according to sources cited in the report. One of them mentioned that individuals have begun receiving termination calls.
Last year, the budget carrier had announced that it would raise more than Rs 2,250 crore by issuing equity shares to a range of investors, including financial institutions and FIIs.
The airline has been contending with numerous challenges, including difficulties with aircraft lessors. SpiceJet also encountered legal disputes with Credit Suisse and its previous owner, Kalanithi Maran, concerning unpaid dues, last september.
At 10:50 am, the shares of the aviation firm were trading at Rs 65 price level, down by almost 4 per cent on BSE.