Post 2021, Indian Airline Sector market capitalization and equity valuations have been very optimistic (to compare with 2015-2020); and the stock prices were zooming for multiple players in this segment. Despite positivity in equity markets, recently in May 2023, Economy Airliner Go First has encountered few challenges leading to pause of its operations. This specific case study highlights the challenges, strategies, alternatives, and series of events took place related to a typical airliner such as “Go First”.

Accumulating Parking Charges: From May 02, 2023, India’s Second Largest airliner Go First has been grounded because of financial and technical challenges. Since then, its 56 aircraft are parked at different Indian airports across the country. As the organization is having weekly meetings, if the situation won’t get resolved soon, it would become a Rs 3,000 crore question for banks just to spend on aero plane parking charges in airports and keep these aircraft live.

Hope to Fly Again: As on July 06, 2023, Go First (earlier known as Go Air) being grounded its aero planes; highlighted its engine scarcity problems and its engine maker Pratt & Whitney promised them to service the jet engines and provide the aircrafts. Regulators have also given a hope that Go First will be allowed to fly again in near future. As we know, the valuation of the operating airline is more than the valuation of the grounded airline. Creditors of Go First were concerned about their funds worth more than Rs 6,000 crore provided to the airline to procure aircrafts. After discussions with resolution professionals, and regulators; creditors agreed to provide an interim funds of Rs 425 crore to bring back Go First on to air again. The stakeholders were also looking for potential acquirers of the airline.

Operational Challenges: Go First in Early May 2023, filed for bankruptcy with NCLT (National Company Law Tribunal), quoting operational challenges and cash crunch because of delays or non-supply of serviced aircrafts from its engine service provider; that led to grounding of its aircrafts.

Revival Plan: As on July 05, 2023, Resolution professionals have informed DGCA (Directorate General of Civil Aviation) that Go First is serious about its coming back to normal operations, and resume services. Soon it would be flying in 70 routes with approximately 160 flights; Regulators were happy with resumption plan.

Need for Sustainability: As on November 25, 2023, global air travel industry is growing at an average compound annual growth rate of 25% during 2022-2027; and Indian air travel industry is growing at a rate of 36%. These growth rates indicate the need for a greater number of low-cost airliners in the Indian sub-continent. India has experienced around 6,36,00,000 domestic air travelers during Jan-May 2023.

Customer Commitment: Go First as on May 2023,expressed that they will refund the customers for flight cancellations; and will pay to vendors on daily basis till the situation recovers. The 50% of its fleet Airbus 320 (that is, 25 aircrafts) were initially grounded because of engine failures and delays from service provider. Later on Based on further discussions, Pratt & Whitney agreed to deliver the serviced aircraft on a phase-wise manner in order to resume operations of Go First.

Impact on Business Law: With Go First issue, lenders were thinking that their $783 million investments (in airliner), valuation will decrease if the airline is non-operational. Law makers were expressed that there would be changes to the bankruptcy law with this business situation.

Further Wait: As on November 03, 2023, Lenders agreed to delay the resolution time by 3 months. According to research, usually in business organizations, 54% of the reasons for failure are project management related; and 43% of the reasons for failure are technical reasons; and 3% of the reasons for failure are miscellaneous reasons.

Thus, keeping the growing demand in domestic air travel, and also astonishing industry growth rate post-covid (>25%) in mind, there is need for more number of players in Indian airline industry; and also the industry is not greatly staggered because of less number of players. The growing air travel industry also allows new entrants to enter into market. One needs to wait for the resolution.

Thank You.

Best Regards,

Dr.Goparaju Purna Sudhakar



  1. ANI (2023), Go First Struggles to Resume Operations, Flight Cancellation Extended Till July 10”, NDTV, July 05, 2023.
  2. Bhargava, J. (2023), “Delay in Go First’s Revival Plan Calls for a Change in Strategy”,, August 10, 2023.
  3. CNTraveller (2023), “Out of Cash, Go First has Stopped Flying for Now: What Happens Next?”, Conde Nast Traveller, May 02, 2023.
  4. Mint (2023), “Go First will Fly Again”, Mint, July 06, 2023.
  5. Rebello, J. (2023), “Go First Resolution Time Extended by Three Months”, The Economic Times, November 06, 2023.
  6. Routers (2023), “Go First Lenders to Challenge Move That Could Let Lessors Reclaim Planes”, The Economic Times, November 09, 2023.
  7. Shukla, T. (2023), “An INR 3,000 Crore Question: Will Go First Fly Again”, The Economic Times, September 25, 2023.

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