NEW DELHI (Reuters) – Indian airline Vistara has negotiated a reduction and deferment of payments to some suppliers to conserve cash, the airline’s CEO said in an internal memo, after the government extended India’s lockdown to contain the coronavirus.
The pandemic has brought air travel to a virtual standstill, with many airline fleets grounded and no visibility on when travel restrictions will be eased.
Prime Minister Narendra Modi on Tuesday extended India’s nationwide lockdown – which began on March 25 – until May 3.
In an email to employees, Vistara CEO Leslie Thng said it was of “paramount importance” to do everything possible to conserve cash.
“We have made some progress with a few of our key partners and suppliers in reducing and/or deferring some of our immediate operating expenditures and are continuing to pursue these measures aggressively with others,” Thng said in the email seen by Reuters.
Vistara is a joint venture between Singapore Airlines <SIAL.SI> and India’s Tata Group.
A statement from the airline said that the extended lockdown and suspension of its services will have a further significant impact on the company’s cash flow and it is taking a number of steps to save costs.
Thng said in his email that Vistara would resume flight operations in a phased manner once it is permitted to do so by the government.
“For the initial period, we may not be able to fully restore our suspended network and therefore our financials will continue to be adversely impacted,” he said.
(Additional reporting by Aditi Shah; Editing by David Goodman)