View Full Version : Whats the latest at Jet
Cost cutting won't slash jobs: Jet Airways - Indian Express (http://www.indianexpress.com/news/cost-cutting-wont-slash-jobs-jet-airways/873254/)
Am following the news about Jet Airways and am wondering whats causing all this trouble. I thought they had a strong balance sheet with a good international product with high yields. Is it just the domestic market pressure with the low cost carriers or the fall of the Rupee or some other factor?
Your thoughts?
LieDetector
10th Nov 2011, 03:24
Their financial statememts have been rather weak in 2011.
Expect retrenchment of about 600-1100 employees soon.
While on the other hand they are adding capacity in the form of 2 B737-900s for 9W and S2 each. Sounds puzzling!
Wannabe Flyer
10th Nov 2011, 07:24
They are carrying quite a large debt and a lot of that in $. 10% rupee depreciation has not helped their profitability. Main difference with KF is that they have and are maintaining cash flow, which KF is not. Overall the low cost bunny is coming home to roost. Air fares at such competitive pricing without having the macro infrastructure and cost stability to protect it (as well as gopi's dream of Re 1 tickets) is not a tenable solution.
If one were to look at it
AI: Teetering with little or no brand loyalty left and a confused product
IT: Well from some experts point of view beginning of the end and with 50 flts less a day so much less capacity in the air
Spice: Quiet player but slow in expanding
GO: Going nowhere
So that leaves jet and Indigo that have the ability to shore up pricing. Jet having a better network has this opportunity to jack rates and not loose too much in ways of occupancy. No conspiracy just the dynamics of the market and the reality which the Indian public will have to live with. No more free rides!
fullforward
10th Nov 2011, 23:26
...the predatory effects of the unfair competition from the ME carriers. In India 70% of the international traffic is in the hands of foreign carriers, at least 40% from Middle East alone.
Looks like it's not India's best interest to have a robust, significant air transport industry. Sad.
As for ME carriers, they are the big predators will eventually kill many airlines globally.
Wannabe Flyer
11th Nov 2011, 04:03
..the predatory effects of the unfair competition from the ME carriers
Not sure domestic operations would be hit by any of the above. Domestic non profitability was hit by the effects of the low cost barrons and the Rs1 fare buster.
In regards to ME carriers, well i think the role of the Civil Aviation ministry is also at play here and why should an airline not take an opportunity if given one.
I also think that for the most part Jet has had at least a 5 year head start on international ops and did not capitalize on it. KF about the same thing and Indigo has just started. AI has had a 50 + year head start and has squandered it away.
Competition is good if one takes it head on. Very easy to point a finger at the ME carriers, but I do not think Indian carriers were restricted by foreign governments for the most part, but by their inability to think big, infrastructure in the country and stupid politicos.