SpiceJet, the budget airline, experienced a significant downturn in its stock performance on Monday, plummeting approximately 4% following reports of impending layoffs amidst financial strain.
The airline’s stock price dipped to Rs 65.41 per share at noon, triggered by revelations suggesting a workforce reduction of around 15%, equating to approximately 1400 employees. This drastic measure comes amidst challenges in meeting salary obligations, exacerbating concerns surrounding the airline’s financial stability.
The downturn marks a stark reversal from earlier gains observed in February when the airline’s stock exhibited a promising trajectory, briefly surging to Rs 74 per share on February 5, before succumbing to recent setbacks.
Acknowledging the imminent staff cuts, a SpiceJet spokesperson emphasized the imperative of aligning companywide costs with operational exigencies, underscoring the rationale behind the austerity measures.
Despite reassurances from the airline’s spokesperson regarding ongoing fund infusion initiatives and progress in financial arrangements, concerns persist over SpiceJet’s ability to navigate the turbulent economic landscape.
Noteworthy is the stark contrast in workforce and fleet size compared to its pinnacle in 2019, wherein SpiceJet boasted a staff complement of 16,000 employees and operated a fleet of 118 planes. Presently, the airline operates with 9000 staff and maintains a fleet comprising 33 aircraft, reflecting a significant contraction in operational scale.
