March is turning out to be a tumultuous month for carriers in India. In March last year, the government started the divestment process for the state-owned Air India and this March, Naresh Goyal was forced to step down as Chairman of Jet Airways.
The reasons for these two happenings are quite similar. Air India had been posting losses since its merger with Indian Airlines in 2007 and the carrier is estimated to have a debt burden of over ₹55,000 crore — a situation that warranted some action.
The situation is no better for Jet. The March 2018 quarter saw Jet post a huge loss of ₹1,036 crore compared to a profit of ₹602 crore in the year-ago period. This loss was a reversal from the profits in the earlier three quarters (June, September and December 2017) and pushed the airline’s full-year FY2018 bottom line deep into the red (₹767 crore). From then on, it was a rapid descent for Jet with big losses in each of the quarters thereafter — the airline’s total loss for the nine months ended December 2018 was about ₹3,200 crore.
Though there were no flight cancellations during Air India’s divestment, the situation for Jet was, and continues to be, serious. After the Directorate General of Civil Aviation cleared a truncated flight schedule for Jet as it had grounded over 70 aircraft because it had not been able to pay the lessors, reports came in on Tuesday that the airline had grounded 15 more aircraft.
John Nair, Head-business travel, Cox & Kings Ltd, says that Jet has been a big disappointment. “Over a year ago, Jet was still the preferred choice for corporate travellers but the erratic schedules over the last six to eight months have forced them to switch to other carriers,” he says.
The ones impacted the most are AI and Jet’s employees. Living with uncertainty for months has led to a loss of morale, particularly amongst Jet’s employees. In the latest hit, Jet is offering its Boeing 737 flight crew not only leave with pay but also a ‘five work-day and three off-day’ roster from April 11 to April 26.
02/04/19 Anand Kalyanaraman/Ashwini Phadnis/Business Line
To Read the News in full at Source, Click the Headline
The reasons for these two happenings are quite similar. Air India had been posting losses since its merger with Indian Airlines in 2007 and the carrier is estimated to have a debt burden of over ₹55,000 crore — a situation that warranted some action.
The situation is no better for Jet. The March 2018 quarter saw Jet post a huge loss of ₹1,036 crore compared to a profit of ₹602 crore in the year-ago period. This loss was a reversal from the profits in the earlier three quarters (June, September and December 2017) and pushed the airline’s full-year FY2018 bottom line deep into the red (₹767 crore). From then on, it was a rapid descent for Jet with big losses in each of the quarters thereafter — the airline’s total loss for the nine months ended December 2018 was about ₹3,200 crore.
Though there were no flight cancellations during Air India’s divestment, the situation for Jet was, and continues to be, serious. After the Directorate General of Civil Aviation cleared a truncated flight schedule for Jet as it had grounded over 70 aircraft because it had not been able to pay the lessors, reports came in on Tuesday that the airline had grounded 15 more aircraft.
John Nair, Head-business travel, Cox & Kings Ltd, says that Jet has been a big disappointment. “Over a year ago, Jet was still the preferred choice for corporate travellers but the erratic schedules over the last six to eight months have forced them to switch to other carriers,” he says.
The ones impacted the most are AI and Jet’s employees. Living with uncertainty for months has led to a loss of morale, particularly amongst Jet’s employees. In the latest hit, Jet is offering its Boeing 737 flight crew not only leave with pay but also a ‘five work-day and three off-day’ roster from April 11 to April 26.
02/04/19 Anand Kalyanaraman/Ashwini Phadnis/Business Line
0 comments:
Post a Comment