[AltoLXI]

An analysis in ET today on the Jet saga.

Link

Naresh Goyal, who built an airline from nothing, left behind a lesson for entrepreneurs — no founder is bigger than the company he runs.

[Ithaca]

An excellent heartfelt article written by Vir Sanghvi on the Jet Saga
The Taste With Vir: Jet Airways and its sudden decline

Source: Vir Sanghvi Hindustan Times

Originally Posted by AltoLXI

An analysis in ET today on the Jet saga.
Link

This was one exhaustive article and learnt a lot reading this.
Thank you for posting this.

[pganapathy]

I know this sounds heartless, but I believe the government should not get involved in saving Jet Airways. In terms of the banks doing it, it should only be done if there is a clear business plan where infusing funds will lead to an increase in revenue/profit and help reduce the debt. If not, let Jet go bankrupt and salvage as much as possible from the assets.

Also, I see that Jet has given a petition to Arun Jaitley to help them. I understand why he even agreed to meet them (need to look politically correct, and election season), but I believe he should have rejected the request outright. Giving the employees hope that the Government will do something is not good for anybody involved.

Finally, the suggestions doing the rounds of merging Jet with other entities, especially Air India, is something to be avoided at all costs. The simple reason both Jet and Kingfisher failed is two-fold. They both acquired airlines that increased their debt (Sahara and Deccan) and they are both Full Service Carriers competing against Low Cost Carriers like Indigo and Spice.

I truly believe that letting them go bankrupt, even if it means unemployment of 25K Jet employees and higher airfares due to lesser competition, is the better alternative in the long run for the Indian economy.

[fiestarry]

Originally Posted by Chetan_Rao

The only thing they possibly skipped asking for was a kidney as collateral (they'd probably settle for my first-born but I have no kids, ha!). shouldn't the standards for institutional lending be higher, not (apparently) lower or non-existent?

Your hilarious statement is so true. There seem to be different rules for the law abiding classes and the big bad ones.
This rings true in all walks of life.

[Miyata]

An unfortunate event. However, Jet Airways seemed to have always enjoyed good degree of political goodwill and strategic manipulation of aviation policies to suit them (and other possible beneficiaries). Possibly also a reason for the differential treatment to Goyal and Mallya?

Air India could be the next in line. At least a major restructuring might be in order. It has debts that would make KF + JA together look a bit respectable, insolvency wise!

I am curious to also know if the pay was delayed/withheld for the top management/executives as well? Or were they beneficiaries of additional bonuses as the JA went into bankruptcy?

[vivek95]

Just happened to read this interesting article on HT on Jet airways. Not really sure how far it is true, but I firmly believe in "Karma"- what goes around, comes around !

Now, 25 years later, the shoe is on the other foot. As Jet goes through its death throes, and Naresh Goyal fades into obscurity, their biggest hope is the Tata Group. And, as it withdraws from its prized slots and premium routes, one of the airlines working overtime to fill those is Vistara — a joint venture between the Tata Group and SIA. Tata Singapore Airlines Version 2.0.

Read more here -


https://m.hindustantimes.com/analysi...yxQAJ_amp.html

[pganapathy]

Assuming this story of Jet and Tata's is true, I can't see the Tata group choosing to bail out Jet unless it goes into bankruptcy. Also, I cannot see why they would choose to take on another airline brand (they already are involved in Air Asia and Vistara), unless they follow the philosophy of the VAG group and have a different brand for a different market group.

Judging by the stories in the media, Jet looks like a goner. Nobody seems to be interested in investing, and their principal assets (landing rights and planes) seem to be disappearing before anybody can even consider an investment to save the airline.

It also looks like no investor is willing to take on the approximately $2 billion Jet owes banks and suppliers. They would rather wait for the airline to go into bankruptcy and then purchase the rights to the Jet name and start from scratch. Seems like the cheaper and perhaps easier alternative.

[V.Narayan]

@pganapathy, in my assessment nails the issue bang on in his lucid post above. The assets are the routes & landing rights plus the parking contracts followed in order by the hangar leases. For the rest - owned aircraft, leased aircraft rights, employees, spares there is no sane reason to pay a premium or what the accountants term goodwill - those can be cherry picked as is already happening. The 'name' value of an airline is the sum of intangibles of service quality rendered by its employees. When the employees and leadership are no longer there the intangible diminishes too. Further, our regulators for reasons lost in 1953 do not permit a taken over airline to be merged with the acquiring entity thus causing immense loss of synergy. All departments other than marketing, finance and legal have to be run in parallel!! This was in part the challenge Kingfisher faced with Deccan and Jet faced with Sahara. The Tata's are already struggling with what to do with Air Asia . They don't, IMHO, need another loss making headache.

[hserus]

Spicejet seems to be leveraging the DGCA to take the lead in asset stripping Jet - the way Goyal allegedly used the DGCA to keep the Tatas out if the Indian airline market for a long time.

https://prime.economictimes.indiatim...-battle-indigo

[Sutripta]

^^^
When Jet was in its death throes, and there was some discussion on why the govt. was taking a hands off approach, suddenly there were a couple of articles on how it was the proactive intervention of the govt. which saved Spice (when the Maran's were getting out/ trying to get out).
And then there was sudden silence on this aspect.

Regards
Sutripta

[Ramsagar]

TWO MISTAKES MADE BY JET AIRWAYS:

Goyal decided to buy a mixed fleet of 10 wide-bodied Airbus A330 and Boeing 777 planes. Mixing in such a small fleet was impractical as it increased cost of resources. Also, Goyal decided to configure them “like palaces,” building in only 308 seats, much lower than the global standard of about 400. He lost a fourth of the potential revenue in the process, executives said.

Even when the configuration changed to 348 seats, Goyal insisted on retaining eight first class seats long after it ..

Read more at:
https://economictimes.indiatimes.com...w/68930916.cms

[PapaBravo]

There have been no refunds from Jet Airways for the flights. I am in the same boat and have around INR 1 lac stuck in airline. No news of refunds yet.

Source

With close to a month now that Jet Airways has temporarily suspended its flight operations, many travel agents and passengers are still waiting for refunds.

The monthly domestic air traffic report of the Directorate General of Civil Aviation has revealed that the percentage of passenger complaints related to refunds this March was highest when compared to atleast 3 years since 2016.

[Turbanator]

Originally Posted by Ramsagar

TWO MISTAKES MADE BY JET AIRWAYS:

Goyal decided to buy a mixed fleet of 10 wide-bodied Airbus A330 and Boeing 777 planes. Mixing in such a small fleet was impractical as it increased cost of resources. Also, Goyal decided to configure them “like palaces,” building in only 308 seats, Goyal insisted on retaining eight first class seats long after it

They did had reasonable success in the International Business class. First Class was only on few routes mostly to London and If I am not mistaken, there is a demand for those seats. I regularly used to fly Delhi - Toronto and their Business class was almost always full. Their services and the quality of food was always better from Mumbai then via Delhi and since last Year on the decline, many seats had problems when reclined to bed and I had learnt how to reset Their overseas routes were profitable as well as they had to compete with Global airlines only and the margins were better. I am not an expert but given the limited number of their Widebody fleet, I think it was manageable but Yes, it would have been easier if they had only one type of Aircraft. Perhaps they got better deals by keeping both.

Originally Posted by PapaBravo

There have been no refunds from Jet Airways for the flights. I am in the same boat and have around INR 1 lac stuck in airline. No news of refunds yet.

That's bad and I will say the Government should help on refunds from some of the money they collect as Taxes.

[binand]

Originally Posted by Turbanator

That's bad and I will say the Government should help on refunds from some of the money they collect as Taxes.

Are you saying tax money should be used to process Jet's refunds? That wouldn't go down well at all...

[narayan]

Originally Posted by PapaBravo

There have been no refunds from Jet Airways for the flights. I am in the same boat and have around INR 1 lac stuck in airline. No news of refunds yet.

surprised they are not issuing refunds for cancelled flights. I have redeemed all my JETMILES over the past 1 month through their rewards store and had no issues ( was actually apprehensive about it ) . I hope they issue refunds soon and no penalise passengers who were still trying to use their services despite all the troubles.