SpiceJet to lay off 15 per cent of workforce, save Rs 100 crore annually

Image Source : PTI (FILE) SpiceJet aircraft

Low-cost carrier SpiceJet is set to lay off 1,400 employees, accounting for approximately 15 per cent of its workforce, as part of efforts to cut operational costs, according to a media report.

"As part of our turnaround and cost-cutting strategy, following the recent fund infusion, SpiceJet has initiated several measures, including manpower rationalisation, aimed at achieving profitable growth and positioning ourselves to capitalise on the opportunities in the Indian aviation industry. Through this initiative alone, we anticipate an annual saving of up to Rs 100 crore," said a SpiceJet spokesperson.

The move is aimed at retaining the interest of its investors and aligning company-wide expenses with operational needs. Currently, SpiceJet operates with around 9,000 employees and maintains a fleet of approximately 30 planes.

The decision to reduce staff comes in response to the airline's significant Rs 60 crore salary expenditure, according to sources familiar with the matter cited in the report. Some employees have already begun receiving termination notices.

SpiceJet has been struggling with delayed salary payments for several months, with many employees still awaiting their January wages.

The airline is reportedly in the process of securing a Rs 2,200 crore fund allocation, but certain investors remain hesitant.

In 2019, SpiceJet operated a fleet of 118 aircraft and had a workforce of 16,000 employees. In comparison, its closest competitor in market share, Akasa Air, operates a fleet of 23 planes with 3,500 employees, holding approximately 4 per cent of the domestic market share.

(With PTI inputs)