SpiceJet: Company battling with Continuous technical Malfunctions and Investors losing their Trust

    Gurgaon-based SpiceJet is caught in the middle of a maelstrom as some air safety mishaps have angered the Indian aviation authority and damaged trust among investors and passengers. Following the airline’s report of eight malfunction incidents in the previous 18 days, the regulator Directorate General of Civil Aviation (DGCA) on Wednesday issued a show-cause notice to the low-cost carrier. The airline, according to the DGCA, failed to set up secure, effective, and dependable aviation services.

    High flight cancellation rates and an increase in customer complaints about the airline have only made matters worse for the business. These accidents have caused a 28 percent decline in the value of the company’s shares since the beginning of May. The safety of thousands of people has been put at risk by technical issues, bird strikes to the engine, and other incidents involving SpiceJet’s aircraft during the past month.

    credit: SpiceJet

    In the latest incident, the airline’s freighter aircraft going to Chongqing in China had to return to Kolkata on Tuesday when the pilots found that its weather radar was not working.

    This month saw another dangerous event when pilots of a Delhi-Dubai flight were forced to make an emergency landing in Karachi, Pakistan, after noticing an odd fuel drop in one of the tanks. In addition to this, according to DGCA data, SpiceJet also canceled the most flights in May. One of the main causes of client complaints and discontent has been this.

    The DGCA study states that over 550 passenger complaints were made against domestic airlines, with SpiceJet receiving 0.8 complaints for every 10,000 passengers in May of this year.

    According to a LocalCircles study, almost 44% of Indians have also voiced their concerns and indicated that they may refrain from boarding SpiceJet flights in the future as a result of recent flying accidents. All of these instances have harmed investors’ confidence, as evidenced by the 18% decline in SpiceJet’s share price over the past month.

    credit: SpiceJet

    SpiceJet still faces problems since new, well-funded competitors like Akasa, Jet Airways, and the enhanced version of Air India, which the Tata group acquired, have entered the aviation sector. Another growing worry is the industry’s struggle to find qualified employees and the rising cost of jet fuel. Since 2019, the airline’s losses have more than tripled. Due to ransomware assaults on its IT infrastructure, it has yet to submit its FY22 results.

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