It is a disorienting experience to board a domestic flight in India, expect Hindi and English announcements and a local crew, and hear a pilot with a British accent. Cabin staff on these flights also appear to be from the United Kingdom. Passengers on select SpiceJet routes have reported this in recent weeks, prompting confusion on social media platforms and travel forums.
While the aircraft exterior carries the saffron branding of the Gurugram-based carrier, the aircraft, crew and operations belong to Ascend Airways, a British charter and ACMI operator. For passengers, the experience feels unusual. For those tracking India’s aviation sector, it reflects the financial stress facing the airline.
To understand why a low-cost carrier in India has outsourced operations to a foreign provider, it is necessary to look beyond the cabin. SpiceJet faces a capacity crunch, with industry estimates indicating that more than 35 aircraft remain grounded. The aircraft are idle due to supply chain delays, engine issues and financial constraints that have limited repairs and lease payments.
In aviation, a grounded aircraft generates no revenue while continuing to incur costs. Despite this, the airline must maintain its schedule and protect its market share as competitors expand capacity.
With aircraft unavailable, the airline has adopted an ACMI arrangement. Under this structure, Ascend Airways supplies the aircraft, crew, maintenance and insurance, while SpiceJet manages fuel, ground handling and ticket sales. The arrangement addresses an immediate operational need.
During the lease period, SpiceJet does not operate these routes directly and focuses on ticket distribution. Ascend Airways manages flight operations. This keeps routes active but adds pressure on costs.
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The financial impact is significant. Under a dry lease, an airline rents aircraft and uses its own crew, maintenance and insurance, benefiting from domestic costs. Under an ACMI lease, SpiceJet pays foreign crew and operating costs, likely in pounds or US dollars, instead of Indian rupees.
In an industry with thin margins, replacing rupee-based costs with foreign currency expenses increases financial strain.
The currency gap adds further pressure. Ticket revenue is collected in rupees, while lease payments are made in foreign currency. As the rupee weakens, operating costs rise while fares remain priced locally. This reduces margins.
On a per-flight basis, these routes are likely operating at a loss. The airline may be absorbing costs through borrowings or existing capital.
This raises the question of why the airline continues to operate these routes. The answer lies in airport slot regulations. At congested airports such as Delhi and Mumbai, take-off and landing slots hold significant value. Under use-it-or-lose-it rules, airlines risk losing slots if they do not operate flights for a defined period.
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In a market where competitors such as IndiGo continue to add capacity and the Tata Group consolidates its airline operations, losing key slots would limit future access. If SpiceJet relinquished these slots, rivals would likely acquire them. The ACMI lease allows the airline to retain its presence while it works to restore its fleet.
The arrangement highlights structural pressure within India’s aviation sector, where capital-intensive operations serve price-sensitive passengers. The use of foreign-crewed aircraft on domestic routes reflects supply constraints rather than service changes. While passengers may notice differences in crew or aircraft interiors, the situation signals reliance on external operators to maintain schedules.
The Ascend Airways lease acts as a temporary measure. It requires immediate cash payments while the airline seeks additional funding and completes aircraft repairs. Each day these flights operate increases costs but preserves future access to key routes. The strategy assumes that the airline will secure funds to return its own aircraft to service and lower operating costs.
Until then, passengers will continue to fly on aircraft operated by a foreign carrier under an Indian airline code. The situation shows that in aviation, operational continuity carries a high cost. When an airline cannot operate its own fleet, it cedes operational control. SpiceJet is managing financial pressure while responding to regulatory timelines. The ACMI lease allows flights to continue, but at a cost. Whether this approach supports recovery will shape the airline’s future.
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The views expressed in this article are solely those of the author and do not necessarily reflect the opinion of NDTV Profit or its affiliates. Readers are advised to conduct their own research or consult a qualified professional before making any investment or business decisions. NDTV Profit does not guarantee the accuracy, completeness, or reliability of the information presented in this article.
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