After a Singapore tribunal ordered engine manufacturer Pratt & Whitney (P&W) to supply bankrupt Indian carrier Go First five engines a month until December, the two sides have been in talks for a new lease agreement. Multiple sources aware of the discussions told Moneycontrol that the agreement will involve the supply of up to 30 new GTF (geared turbofan) engines.
“Both parties have been in talks for the last few weeks to reach a new lease agreement under which P&W will supply around 30 new GTF engines to the airline from December,” an executive close to the engine manufacturer told Moneycontrol.
He added that under the terms of the new agreement being discussed, P&W has offered to be in be paid three smaller tranches, instead of a lump sum upfront payment, for its engines and has offered to cover the maintenance and servicing costs of the engines.
Another executive aware of the discussions told Moneycontrol that the earlier engine lease agreement signed between P&W and Go First would be terminated if the new terms are accepted by both parties.
An executive from Go First who is aware of the discussions told Moneycontrol that the new lease agreement is being discussed as part of Go First’s plans to scale up operations in 2024, once it restarts operations.
“P&W has come to the table with a new offer to continue supplying engines to Go First following the verdict by the SIAC, and both parties are discussing terms to move forward amicably," the official said.
SIAC refers to the Singapore International Arbitration Centre, where the two sides were engaged in arbitration over faulty P&W engines that Go First says led to its fleet being grounded and forced it to file for insolvency.
24/07/2023 Yaruqhullah Khan/Moneycontrol
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