INDIA: Bad Times For Jet Airways, Will They Fly Again?

After stopping operations earlier this month, Jet Airways technically isn’t gone forever. There are still some who want to see the airline gain additional financing in order to resume operations.

While there are some indicators Jet Airways could fly again, it seems unlikely given the current situation.

Jet Airways had a lot of debt and very little cash. India’s all out price war, with fares as low as a few cents, meant that there was an incredibly slim margin for profit.

Unfortunately, the market just didn’t work for Jet Airways. They invested in new aircraft, including the 737 MAX, and broadened their international partnerships. With a robust route network, Jet Airways thought they could be India’s top carrier.

Also burdening Jet Airways were high fuel costs and high taxes. Jet Airways simply could not make a profit. They teetered and tottered for months before finally seeing their fleet depleted.

In the days prior to their official suspension, only a handful of aircraft were operating and zero international routes were scheduled.

There has been a movement to resurrect Jet Airways. Former Jet Airways staff engaged in protests to get the airline up and running again. Jet Airways had a sizeable staff who are now faced with major uncertainty.

While some crew members went off to rival carriers, like SpiceJet, others are still looking for opportunities.

Jet Airways relied heavily on Etihad Airways for investment. Etihad itself faces significant financial concerns, yet somehow found Jet Airways worth sustaining. Over the years, they have put millions of dollars into the airline.

However, after the collapse of the airline and Etihad’s ongoing losses, it doesn’t seem like Etihad would want to resurrect the carrier before they get on solid financial footing themselves.

Etihad could always partner with an Indian conglomerate as Singapore Airlines did with their investment in Vistara. This could give Etihad some additional security since they wouldn’t necessarily be the ones pumping in funding for Jet Airways.

Jet Airways seems to be running out of luck and time for a new investor. With rival carriers descending on Jet’s valuable assets such as planes and the valuable slots at crowded airports, Jet Airways would face significant headwinds if they restarted operations.

This would definitely worry investors, especially as Indian airlines continue to miss out on record profits that other carriers see.

This is the question that aviation analysts and investors are grappling with. Jet Airways has a lost a lot in terms of positive name recognition, reputation, and key assets.

A new Jet Airways would have to reassure travelers that they can trust the carrier with their travel plans.

India’s aviation market is already quite crowded. State run Air India doesn’t seem to need to focus on turning a profit and low-cost carriers account for a significant market share.

As a result, it would be necessary for Jet Airways to define themselves as something different to what India already has. The problem is that Jet Airways doesn’t really have anything new and unique to offer travelers that current carriers cannot provide.

Delta Airlines recently announced a return to India. Though still vague on a few details, Delta plans to fly from New York to Mumbai. Mumbai was a major hub for Jet Airways. Thus, it made sense for Delta to connect the cities since there would be strong connecting opportunities.

Jet Airways has closely worked with Delta and KLM.

In the aftermath of Jet’s collapse, it seemed highly unlikely that Delta would return to Mumbai. Previously, it was reported that Delta may have some interest in Jet Airways and had a codesharing partnership with the carrier.

However, now that Delta is returning to Mumbai, it could be possible that they will have a role in resurrecting Jet Airways. Now, while there are no official reports or even rumors indicating Delta is seriously considering this.

While many would like to see Jet Airways resume operations, it seems highly unlikely, it may be the end of Jet Airways forever.


Tourism Observer