‘Acquiring grounded planes in India is a major struggle’
₹400 crore to buy the three aircraft but is staring at further headwinds as the aircraft grounded for over four years will require 8-12 months to become airworthy and flown out of India. It will take some more time to convert the passenger planes to freighters, the company said. “...the more you wait, or the more the aircraft is on ground, it loses value and eventually you reach a point when the value of the assets is zero or sometimes even minus.
We believe that those three assets were almost there if the court would have theoretically decided differently or would have thought of waiting a little bit longer," Michael Koish, the chief investment officer of Challenge Airlines, said. However, the cargo air operator said it is still keen to buy the other two B777 aircraft, but is awaiting further clarity from the monitoring committee on the norms to be followed for the auction. The company, with bases in Israel, Belgium and Malta, is set to start a cargo service on the Mumbai-Hong Kong route, and eventually expanding it to Hong Kong-Mumbai-Tel Aviv five times a week.
“This is just the first step in the Indian market. After that maybe we will continue with an additional stop in Delhi and can look at India-Europe as well," Koish added. While the risk appetite of aircraft lessors for the Indian market has improved since the days of the Kingfisher Airlines collapse in 2012, global aircraft lessors are closely following the asset recovery process of Jet Airways to fine-tune their strategy for Indian airlines, Koish said.
“We hear a lot of feedback from our colleagues from the big lessors... I think that ours is like a study case for them on the legal side and beyond. I think that India is doing a few steps which are quite
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