BackVistara defers payments to some suppliers, some staff to take 'no-pay' leave
Vistara has negotiated a reduction and deferment of payments to some suppliers to conserve cash, the airline's CEO Leslie Thng said in an internal memo The airline has also instituted a compulsory "no-pay" leave for a section of its employees to mitigate the economic fallout of the coronavirus pandemic
PremiumNEW DELHI : 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 nationwide lockdown to contain the coronavirus, Reuters reported.
The airline has also instituted a compulsory "no-pay" leave for a section of its employees to mitigate the economic fallout of the coronavirus pandemic, news agency IANS reported.
These leaves without pay range from one to three days, depending on employment grades. Senior-most employees will have to take three days of compulsory no-pay leave, the agency said.
"The extension of lockdown and suspension of our services till May 3 further impacts our cash flow significantly. As part of a number of steps we are taking to conserve cash and save costs, we had to make the difficult decision of further reducing our staff costs with the objective of preserving jobs," a Vistara spokesperson was quoted as saying in a statement.
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 the 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 and 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.
(IANS also contributed to this story)
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