GO Airlines’ low cost business model left it vulnerable to the impact of the Covid-19 pandemic, rising commodity costs and global supply chain disruptions.
GO Airlines’ budget friendly business model faced challenges prior to 2020 due to rising fuel costs and the competitive nature of India’s domestic airline market. Despite these obstacles, the firm expanded operations to increase market share. However, the Covid-9 pandemic severely impacted the airline industry, reducing travel and damaging GO Airlines’ financial position, leaving the firm in a difficult position with vendors and creditors. Needing funds, GO Airlines planned an IPO in 2021 but regulatory delays and market volatility kept the offering on the shelf. Under financial pressure, the airline was ill positioned to handle rising fuel costs in the wake of the Russia Ukraine conflict. Further, GO Airlines was unable to secure timely servicing and replacement of key engine components, grounding a large share of its fleet in the spring of 2023. The significant loss of revenue pushed the firm into bankruptcy.
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