Jet Airways will cancel around 40 flights a week on seven Gulf routes from Wednesday, as it struggles to raise funds and stay afloat. The airline will cut flights to Doha, Muscat, Abu Dhabi and Dubai from various domestic cities, including Doha-Kochi; Kozhikode-Thiruvananthapuram; Abu Dhabi-Lucknow; Abu Dhabi-Mangalore; Mangalore-Dubai and Delhi-Muscat.
Cash-starved Jet Airways has temporarily suspended its complimentary lounge services to JetPrivilege platinum and gold members travelling in economy class. The revised complimentary lounge access policy, which is not applicable for flights operated by its codeshare partner carrier, will come into effect from Dec 1.
A Jet Airways spokesperson said the airline "has undertaken a comprehensive review of its network, whereby it will move capacity from uneconomical routes to more profitable ones, to more closely align the capacity offered with the demand characteristics of specific markets. As part of this strategy, Gulf operations are being optimised to focus on connectivity at our hubs in Mumbai and Delhi instead of point-to-point connectivity.
While intense pricing competition, weak rupee and rising fuel costs have hurt Indian airlines like IndiGo owned by InterGlobe Aviation Ltd and SpiceJet Ltd, Jet Airways is in a league of its own.
Concentrating capacity over Jet Airways' hubs will enhance frequencies to offer greater choice to guests, while improving our asset utilisation and resource productivity."
"The airline launched its first daily direct service effective December 1 from Pune to Singapore and host enhanced frequencies on Delhi to Bangkok, Doha, Singapore, Kathmandu and Mumbai to Doha, Singapore and Dubai during the winter schedule," he added.
The airline says pulling out of some Gulf routes will not affect its scale of operations. "We also acknowledge the interim inconvenience the above changes may cause to the travel itineraries of our guests. We would like to reassure them that we will take all measures, including proactive communication and re-accommodations, to minimise such inconvenience," the spokesperson said.
Jet has been facing a severe cash crunch due to which it has delayed salary payment to pilots, aircraft maintenance engineers and senior management. The airline's founder-promoter Naresh Goyal is learnt to have held talks with the three prospective investors - Tata Group; Etihad and Air France-Delta-KLM.
"Jet is too big to shut down. Goyal has held detailed discussions with the prospective investors," said a source. While selling to Tata means the substantial ownership and effective control (SOEC) remains with an Indian entity, selling stake to the foreign airlines will mean looking for an Indian entity to satisfy that clause.
Etihad has 24 per cent stake in Jet and talks are on to see under what conditions would it be willing to raise that to 49 per cent. In June 2016, NDA had allowed 100% FDI in airlines with a cap that foreign airlines' stake should not be beyond 49 per cent and rest be owned by a non-airline foreign entity. But the SOEC of such airlines must be with the Indian partners, like it is with the Tatas in Vistara where
Singapore Airlines has 49 per cent stake.
Jet has not commented on this issue as it says it does not comment on speculation.
Some prospective investors want Goyal to cede control. For now, it seems the Tatas - who were reportedly keen that Goyal exit the airline - have taken a back seat and talks with Etihad are being pursued more vigourously.