SpiceJet, one of India’s leading low-cost carriers, has reduced its workforce significantly in the fiscal year 2023-24.
The airline, which has been grappling with financial challenges, announced the layoff of nearly 1,400 employees, translating to about 15% of its workforce.
SpiceJet Financial Struggles and Cost-Cutting Measures
SpiceJet’s decision to downsize its workforce is part of a broader cost-cutting strategy aimed at reducing operational expenses and improving financial stability.
The airline has faced several financial hurdles, including delayed salary payments and a significant decline in revenue.
By reducing its workforce, SpiceJet aims to save up to Rs 100 crore annually.
The layoffs have affected both permanent and non-permanent employees.
The airline cut 716 permanent male employees and 618 female employees, along with 531 male and 30 female non-permanent staff.
Despite the reduction, SpiceJet has increased the proportion of employees earning above the minimum wage.
Among permanent employees, 74% of men now earn above the minimum wage, up from 61% previously.
Similarly, 56% of women now earn above the minimum wage, an increase from 37%.
Fleet and Operational Changes
SpiceJet’s fleet size has also been impacted, with the airline operating 60 planes, including six wet-leased aircraft, as of the end of FY24.
The airline aims to increase its fleet to 100 planes by 2026 through a Qualified Institutional Placement (QIP) that raised Rs 3,000 crore.
This fund will be used to revive grounded aircraft and improve fleet utilization.
SpiceJet’s Chairman and Managing Director, Ajay Singh, has emphasized the airline’s commitment to achieving profitable growth.
He highlighted the company’s focus on capitalizing on opportunities in the Indian aviation industry.
The company has settled with lessor Aircastle, resulting in the withdrawal of an insolvency case, and is focused on finalizing key settlements.
Ajay also highlighted the importance of aligning company-wide costs with operational requirements to ensure sustainable growth.
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