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  • Company Background Jet Airways

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    Priyank Agarwal
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    Jet Airways was once India's largest commercial passenger airline but suspended all operations in April 2019 and filed for bankruptcy. It had a passenger market share of 22.6% in 2010 but fell to second place behind Indigo in 2017 with 17.8% share as lower fares from competitors resulted in heavy financial losses for Jet Airways. The company is now subject to insolvency proceedings.

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    information about jet airways background and turnaround stratergy

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    Jet Airways was once India's largest commercial passenger airline but suspended all operations in April 2019 and filed for bankruptcy. It had a passenger market share of 22.6% in 2010 but fell to second place behind Indigo in 2017 with 17.8% share as lower fares from competitors resulted in heavy financial losses for Jet Airways. The company is now subject to insolvency proceedings.

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    47 views4 pages

    Company Background Jet Airways

    Uploaded by

    Priyank Agarwal
    Jet Airways was once India's largest commercial passenger airline but suspended all operations in April 2019 and filed for bankruptcy. It had a passenger market share of 22.6% in 2010 but fell to second place behind Indigo in 2017 with 17.8% share as lower fares from competitors resulted in heavy financial losses for Jet Airways. The company is now subject to insolvency proceedings.

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    COMPANY BACKGROUND

    Jet Airways (India) Ltd. is an Indian airline based in Mumbai, India, which suspended all its
    air operations on April 17, 2019. As of the third quarter of 2010, Jet Airways was the largest
    commercial passenger airline in India, with passenger market share of 22.6%. With its
    competitors, mainly SpiceJet and Indigo Airlines, which lowered their ticket prices over the
    next few years, they were forced to do the same, which detracted from overall
    performance, resulting in heavy financial losses. It fell to the second place behind Indigo in
    October 2017, with a passenger market share of 17.8%. The downward slide continued
    unabated and, as of July 2019, the Company is currently subject to insolvency proceedings
    under the Bankruptcy and Insolvency Code (2016).
    Jetairways achievement
    In its first year of operations, Jet Airways managed to carry 730,000 passengers!
    In 2004, Naresh was even selected to serve on the Board of the “International Air
    Transport Association” (IATA) from 2004–2006, and was later, re-elected in 2008 with
    his tenure extending until June 2016, as well.
    And by the end of that year, international routes from India were liberalised and jet
    started with their first flight between Mumbai and London, followed by Delhi-London in
    2005 too. In the same year, the company crossed yet another huge milestone when it
    launched its IPO.
    In 2007, the company also acquired “Air Sahara” for a whooping $500 Mn and re-
    launched it as “Jetlite“.
    Turnaround stratergy
    The first part of the turnaround strategy was to split the low-cost model from the main
    operations.
    They also cut back on huge costs by merging their two budget carriers JetLite and
    JetKonnect and cutting back on international flights.
    A full-service brand across the business converted into a huge improvement in the
    corporate customer base, which eventually led to higher yields.
    Next – the seat configuration on the domestic fleet were standardised with 12 business
    and 156 economy-class seats. This also gave the airline the flexibility to use its aircraft
    both on domestic and international routes.
    Then, of course, there was the much-needed capital booster shot they had recently
    received from Etihad Airways as well.
    The Jet-Etihad partnership has completed its first full financial year of operations
    (2014-15) and Jet’s earnings have exhibited a sustained recovery, which also reported a
    net quarterly profit as well.
    Industry overview
    Indian aviation industry has been one of the fastest growing aviation industries in the world
    with private airlines accounting for more than 75% of the sector of the domestic aviation
    market. with a compound annual growth rate of 18% and 454 airports and airstrips in place
    in the country.
    The Indian aviation sector can be broadly divided inth the main following categories
    1 schedule air transport
    2 non schedule air transport
    3 international airlines

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