Monday, April 15, 2019

Here is how you will be impacted by the suspension of Jet Airways' international operations

The early signs of distress in Jet Airways were visible in the July to September quarter of 2018. While the airline was gloating over the induction of Boeing 737 MAX8 aircraft – its first new induction after ages — there was little to cheer on the financial side.

One of the principal casualties of the financial duress was the international network. It was a chicken-and-egg situation for Jet — international routes were critical for the airline to stay aloft as they accounted for more than 50 percent of revenues in the preceding quarter, but the debt-laden airline did not have the cash or the planes to persist with these routes.

As of last weekend, the airline closed reservations of its long-haul wide-body operations to Amsterdam from Mumbai, Delhi and Bengaluru, to London from Mumbai and Delhi and to Paris from Mumbai and Chennai, leading scores of passengers stranded. From what was restricted to airports in India, the Jet Airways crisis was going global. This was followed up by the news of Etihad Airways taking away the three pair of slots it had leased to Jet at London Heathrow – one of the handful of airports in the world that allow slot trading.

Over the years, Jet had built a formidable international network. This included the flights to the Middle East from multiple points in India, its long-haul network to North America – first via its hub at Brussels and later from Amsterdam and its four daily flights to London.

The withdrawal of international services also marks an almost end to its wide-body operations led by the B77W aircraft, the first of which was inducted in mid-2007. Unfortunately, the aircraft arrival coincided with the downturn of 2008-09 and the airline, for the most part, had the planes being leased to Etihad, Turkish, Gulf Air and Thai Airways. When the entire fleet was back at the beginning of winter schedule in 2017, the airline re-started its aggressive expansion only to hit a roadblock within a year.
15/04/19 CNBC TV18
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