Christmas trees act: Lessor alleges SpiceJet removed aircraft engines

US-based Spectre Cargo Solutions has alleged through its Irish affiliates that SpiceJet has removed engines from the five Boeing 737 freighter planes it had leased to the airline..

The airline, however, said that it has already returned two aircraft to the lessor and is working to return the three grounded aircraft to service within the first quarter of 2025.

It said that the two parties are also working together to lease additional aircraft.


"Further it must be pointed out that you didn't seek the approval of my clients before taking aforementioned actions and neither have you paid for the use of my clients' high value equipment and continue to use the equipment without remunerating my clients for the same," Sarin & Co, a law firm representing three of Spectre Cargo Solution' associates-NG Genesis Limited, NGF Charlie Limited, NGF Alpha Limited-said in a notice sent to SpiceJet, a copy of which was seen by ET. "Therefore, prima facie, you are inter-alia guilty of theft."

The practice of removing parts to keep another plane flying is commonly known as turning the disused planes into "Christmas trees". Although rare, the practice is most often linked to financial difficulties. But according to agreements between airlines and lessors, the planes have to be returned in similar condition as they were when originally leased.

SpiceJet has gone through a severe financial crisis, during which it defaulted on payment of aircraft lease rentals to multiple lessors. The Delhi High Court summoned senior executives of the airline recently for failing to comply with an earlier order to pay $6 million to engine lessor Team France.

After a fundraising of ₹3,000 crore through a qualified institutional placement, however, the airline has been able to resolve some of the disputes. For instance, on Wednesday, it said that it had settled a dispute of around $16 million with Dublin-headquartered Genesis Aircraft Services. Under the agreement, SpiceJet will pay Genesis $6 million and Genesis will acquire $4 million in SpiceJet equity at a price of ₹100 per share, the airline said.