Regional airliner Air Costa is passing through turbulent times and is pinning its hopes on some investments coming through for its revival. Flights of the carrier, which operates with a base in Vijayawada to nine destinations, have been suspended since February 28, and the financial crunch has made things worse for the airline staff, whose salaries are yet to be paid.
When contacted, Kavi Chaurasia, Vice-President, Marketing, of the airliner told BusinessLine , “We are pinning hopes on bringing in strategic investors and infusing funds to revive the airline. The flights were suspended due to a financial crunch.” The airliner, which celebrated its third anniversary in October 2016 under a regional air licence, was upgraded as a national player with a licence for pan-India operations by the Director-General of Civil Aviation.
The company management had been planning to connect smaller cities and Delhi and Mumbai as it strengthens its fleet. However, due to the financial crunch and delayed payments, its leased aircraft were grounded and flights stopped in February. While promoters of the airline, the LEPL Group, had big plans and had also hinted at booking a number of aircraft to meet its expansion plans, the cash crunch and delay in finding a strategic partner have hit the airline hard.
The salaries of its staff of over 600 are yet to be paid. A number of its pilots have also moved out to other airliners in the expansion mode.
It was planning to operate with six aircraft by December 2016, early 2017. But the financial difficulties and delays in securing funds have not only grounded the airliner but also impacted its staff.