Jet Airways Crises

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Good morning

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JET AIRWAYS CRISIS

JET AIRWAYS:

JET AIRWAYS About Jet Airways : Jet Airways (India) Private Limited is India's leading private airline. It boasts a market share of about 29 percent. Jet operates a relatively young fleet of Boeing 737 jets and ATR72 turboprops. It carries about seven million passengers a year. Its reputation for punctuality and outstanding service attracts a large

Light on Naresh Goyal: Founder and CEO:

Light on Naresh Goyal : Founder and CEO Naresh Goyal is the founder and Chairman of Jet Airways, India's largest domestic airline. In May 1974, Naresh Goyal founded Jet air (Private) Limited to look after Sales and Marketing operations of foreign airlines in India. Naresh Goyal took advantage of Open Skies Policy of the Government of India and set up Jet Airways

Key Dates: 1993: Jet Airways begins domestic operations flying Boeing 737 jets. 1997: Kuwait Airways and Gulf Air sell their stakes in Jet Airways. 1999: A regional network is launched with turboprop aircraft. 2004: The first international services are started. 2007: Acquired Air Sahara and re launched it as jet lite.:

Key Dates: 1993: Jet Airways begins domestic operations flying Boeing 737 jets. 1997: Kuwait Airways and Gulf Air sell their stakes in Jet Airways. 1999: A regional network is launched with turboprop aircraft. 2004: The first international services are started. 2007 : Acquired Air Sahara and re launched it as jet lite.

Principal Competitors::

Principal Competitors: International Market : - British Airways - South West Airlines Domestic Market : - King Fisher - Indian Airlines - Go Air - Spice jet - Indigo

Marketing Strategy: STP for Jet airways.:

Marketing Strategy: STP for Jet airways. Market Segmentation: Economic Class Business Class Premium class Target customers Business Class Economic class (Jet lite )

Promotional Activities:

Promotional Activities For promotions they use tactics like i ) Offering free tickets ii) Concessional fares for students iii) Jet lite surprises iv) Corporate deal offers

FLIGHTS OF JET AIRWAYS  :

FLIGHTS OF JET AIRWAYS It operates over 400 daily flights to 65 destinations worldwide. Provides services in: 44 domestic destinations in India 21 international destinations in 17 countries across Asia, Europe & North America. International destinations include Colombo, New York, Toronto, Singapore etc.

FLEETS OF AIRCRAFTS IT INCLUDES  :

FLEETS OF AIRCRAFTS IT INCLUDES IT HAS 84 AIRCRAFTS Airbus330-200*   -  (12) Atr72-500   -   (14) Boeing737-700   -  (13) Boieng737-800  -  (33) Boeing737-900  -  (2) Boeing777-300er*  -  (10) * Includes aircraft that have been leased to other airlines

Annual results in brief :

Annual results in brief Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Sales 11,476.98 8,811.10 7,057.78 5,693.73 4,338.01 Operating profit -306.75 187.55 362.08 928.53 1,210.66 Interest 738.03 492.75 240.15 241.60 253.69 Gross profit -734.88 365.21 465.46 1,128.67 1,039.13 EPS (Rs) -46.60 -29.17 3.24 52.36 45.41 (Rs crore)

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Market Share

Recent problems ::

Recent problems : In oct 2008 around 1900 employees were fired out of which 800 were laid off. It started voice from politicians , staff , senas , public. Later in the same week they were taken back. N.A.G( NATIONAL AVIATORS GUILD ) formed on 24 th July claiming a membership of 680 ,President Girish Kaushik , Gen.Sec.Captain Sam Thomas.

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Due to which two senior pilot were fired . Captain Sam Thomas( g.s ) Captain D Balaraman . On Aug. 23 rd the Guild (NAG) warned that they would go on strike from Sep. 7 th if both the pilots are not reinstated.

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But on 8 th sep. 432/1056 pilots reported sick in violation of Bombay high court orders a day earlier restraining them against any kind of strike in countries largest pvt. Carrier. Pilots were demanding the reinstatement of their colleagues. Situation created huge problems for passengers .80% of them were accommodated to other airlines for rest entire fare was refunded.

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Chief justice Swatanter Kumar and Justice AM Khanwilkar issued a notice against NAG seaking a reply in 2 weeks. Later 2 more pilots were sacked Civil aviation secretory Madhavan Nambiar said govt. has nothing to do between both, but they has taken serious view of the inconvenience to public and asked DGCA to take action. CEO told he is open for talk but he told company does not recognize NAG. and pilots are behaving like terrorists.

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Fortunately after “loss of crores and goodwill” on 13 th sep. strike ended after 5 days when Naresh Goyal reinstated the sacked pilots and paved the way for possible recognition of a pilots union. Back to work

Strike: A Huge Loss:

Strike: A Huge Loss From 8 to 13 September: Jet Airways lost 200 crores in just five days. Cancellation of 134 domestic and 32 international Flights Average passenger per day dropped from 23000/day to 14000/day.

Strike: A Huge Loss:

Strike: A Huge Loss Jet has to accommodate 80 % of the passenger on the other carriers. For the rest entire fare has been refunded. Loss of goodwill is not measurable.

Can Pilots Form A union?:

Can Pilots Form A union? It is written in our Constitution that it is a fundamental right of every citizen to form groups or union. Under IDA pilots are classified as workmen. Under WCA members of any company, organization or Industry can form a trade union if they are more then 100 people.

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IS IT STRIKE?

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IS PILOTS ARE ON SICK LEAVE?

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OR IS IT SOMETHING ELSE?

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Actually it is a strike.

Illegal Strike:

Illegal Strike According to INDUSTRIAL DISPUTE ACT: Any strike without giving notice during conclusion processing is prohibited. Even if they have given a notice then also they have to wait for 14 days. Then only they can go on strike. After the conclusion on consolation proceeding they have to wait for 7 days before they can go on strike.

Advantage of jet airways crisis for other airlines :

Advantage of jet airways crisis for other airlines Jet Airways transferred as many as 60 percent of the passengers booked on its flights to Air India, the national carrier, and other airlines during the strike. Rival carriers began to charge fares at almost double the usual rates after the strike hampered Jet Airways operations. A big competitor was out, therefore it was a big advantage to other airlines

Advantage of jet airways crisis for other airlines :

Advantage of jet airways crisis for other airlines Jet Airways transferred as many as 60 percent of the passengers booked on its flights to Air India, the national carrier, and other airlines during the strike. Rival carriers began to charge fares at almost double the usual rates after the strike hampered Jet Airways operations. A big competitor was out, therefore it was a big advantage to other airlines

Advantage of jet airways crisis for other airlines :

Advantage of jet airways crisis for other airlines Jet Airways transferred as many as 60 percent of the passengers booked on its flights to Air India, the national carrier, and other airlines during the strike. Rival carriers began to charge fares at almost double the usual rates after the strike hampered Jet Airways operations. A big competitor was out, therefore it was a big advantage to other airlines

Current Situation  :

Current Situation The standoff between the airline and its pilots ended late Saturday after the company agreed to reinstate four pilots who were fired for trying to form a pilot’s union. Jet airways has reduced its fares to 50%.With discounts, the cost of air tickets dropped close to air-conditioned II tier Rajdhani Express fares. Jet airways witnessed a 10 per cent switch from low-cost carriers to jet. The airline is operating on full schedule of services on its domestic and international flights with all crew reporting for duty

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5. Jet offered a full refund to passengers whose flights were canceled. The sacked pilots are rehired and a consultative group is being formed comprising representatives of the company and pilots to continue the process of dialogue to resolve all their problems. Jet Airways suffered a loss of nearly US$8 million a day during the strike. and the number of passengers came down from 23,000 per day to 7,500. No punitive action against any one who participated in the agitation

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Shares of Jet Airways rose as much as 4.6 percent, the most in two weeks. Airline losses globally may total $9 billion this year, according to the International Air Transport Association, almost double the group’s previous forecast.

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THANK YOU

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