Employees demand answers from indebted flight carrier Air Costa

Andhra Pradesh-based regional airline Air Costa suspended its flight operations, citing financial difficulties.

Published: 01st March 2017 01:10 AM  |   Last Updated: 01st March 2017 01:46 AM   |  A+A-

Express News Service

CHENNAI: Andhra Pradesh-based regional airline Air Costa suspended its flight operations, citing ‘financial difficulties’ on Tuesday barely four years into operations.

Allegedly mired in debt, the company, which had four Embraer-190 aircraft when it started off in 2013, has been left with none with the planes seized by its lender GE Capital Aviation Services (GECAS). Sources in the airline confirmed that the company has been struggling financially since 2015.

Sixteen flights to eight destinations were affected on Tuesday, but Air Costa said they will resume on Thursday or Friday. Employees said the management did not keep them in the loop regarding the grounding of operations.

Sources in the airline confirmed the repossession of air Costa’s planes. “We had four aircraft in the beginning, then it went down to three, two and now we have none,” he added.

Promoted by the Vijayawada-based LEPL Group, the airline suspended its operations once before, in August 2016, due to an inability to repay its defaults.

The beleaguered airline has reportedly defaulted on payments to its lender. Sources in the company said some employees have not been paid since December 2016. Sources who spoke to New Indian Express on condition of anonymity, said Air Costa has withheld some employees’ salary for two months, including Employees Provident Fund.

Employee sources of Air Costa alleged that the company has not responded to their queries or met them to discuss the issue. They plan to travel to Vijayawada on Thursday to discuss their arrears with the management.

A source said, “It has been a very one-sided affair. Some of us haven’t been paid for two months. Dues are pending, salaries are pending, and we have no guarantee of getting any of it back.”


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