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CRISIS IN JET AIRWAYS

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INTRODUCTION Jet Airways (India) Private Limited founded by

Naresh Goyal in 1991. Jet Airways also operates two low-cost airlines

including JetLite (formerly known as Air Sahara) and Jet Airways Konnect

In April 2007, Jet Airways took over Air Sahara, which was later on renamed as JetLite

Jet Airways introduced another low-cost airline Jet Airways Konnect in May 2009

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JET AIRWAYS PRESENCE IN INDIA

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DAILY FLIGHTS Operates over 400 flights daily, to as many as 44

destinations in India including Hyderabad, Chandigarh, Delhi, Goa, Ahmadabad, Bangalore, Mumbai, Amritsar, Lucknow, Kolkata.

Was the first private airline of India to fly to international destinations - it operates daily international flights to 20 international destinations, including Hong Kong, Kathmandu, Kuala Lumpur, Singapore, Bangkok, London, New York.

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CHALLENGES FACED BY JET AIRWAYS

• High cost of the aviation turbine fuel, in the first half year of 2008.

• Prices of crude begin to rise again and will play major role in profitability of aviation industry.

• The second has been the global economic downturn, which has led to a steep fall in the demand for air travel and intense pressure on yields.

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• Bullet point– Sub Bullet

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FINANCIAL PERFORMANCE OF JETAIRWAYS

• Operating revenue has been increased .• Income has been increased.• Pat (profit after tax) decreases.• Revenue passenger decreases slightly.

( All points are of 2008-2009 and compared with 2007-08).

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FINANCIAL PERFORMANCE OF JETAIRWAYS

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MAIN PROBLEM

• 2 pilots Capt. Sam Thomas and Capt. D. Balaraman were sacked.

• Reason acc to the executive director was due to internal rules and discipline.

• But acc to pilots it was due to their role in NAG (National Aviators Guild )

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Pilots point of view• Pilots believed that 2 pilots of Jet Airways were

dismissed because both were office-bearers of the newly formed NAG.

• Problem was also due to that the foreign management was making Indian pilots wait indefinitely for promotions.

• Management failed to produce the reasons for sacking the pilots.

• Few more senior captains were terminated from there services.

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Management point of view

• It said that reason behind sacking pilots were internal disciplinary issues and the lawyers were consulted before sacking of pilots

• Jet Airways moved an application in the High Court to pass an order restraining the NAG and its members from going on any form of strike.

• The management was insisting on dissolving the union before taking pilots back on duty.

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• As a result to show anger and protest around 500 pilots did not join the duty reporting sick

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Negative Effects Loss of over Rs 2 billion ($40 million). Transfer of nearly 60 percent of the passengers on

other airlines, hence it spoiled the goodwill of company among public.

Thousands of passengers were affected due to dirupted flights.

Also the passengers who tried other airways had to pay double or even triples prices for d same journey.

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AMICABLE AGREEMENT• Management decided to re-instate 4 sacked pilots and not

initiate any action against the nearly 500 pilots who agitated.

• A consultative body would be set up comprising representatives of the management and the staff to resolve issues concerning the pilots.

•The committee includes two directors of the company and the chief executive officer plus two pilots representatives to ensure smooth functioning and proper implementation of the decisions.

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EFFECT OF SICK LEAVES

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