Jet Airways, which went under and ceased operations in April 2019, and since then has been attempting to find a new owner, finally has a successful new bidder in Murari Lal Jalan and Kalrock Capital. The winning bid was announced in October 2020, and over 99% of the Committee of Creditors voted for this bid to be considered. However, the NCLT, the court in which this bid has to be finally blessed for the wheels to be put in motion, still hasn’t taken a view on the ‘Success’ of the proposal, as per publicly available information. And hence, this bid has yet not led to a handover of the airline’s control to this new bidder.

There has been no word from the to-be-new-owner of the airline so far, until today.

The consortium, led by Murari Lal Jalan and Kalrock Capital, intends to revive Jet Airways as a full-service carrier by the Summer of 2021. Further, the consortium says that Jet Airways wants to operate all of its historic domestic slots in India, and also restart international operations. In a press statement issued by the consortium, they said,

The Jet 2.0 program is aimed at reviving the past glory of Jet Airways, with a fresh set of processes and systems to ensure greater efficiency and productivity across all routes. As per the resolution plan, Jet Airways intends to operate all of its historic domestic slots in India and restart international operations. If everything goes as per plan and the Consortium receives the NCLT and regulatory approvals on time, Jet Airways would be back in the skies by the Summer of 2021.

The press statement further goes on to state,

The Consortium’s vision is to regain the lost ground, set new benchmarks for the airline industry with the tag of being the best corporate full-service airline operating on domestic and international routes. The Jet 2.0 hubs will remain Delhi, Mumbai, and Bengaluru like before. The revival plan proposes to support Tier 2 and Tier 3 cities by creating sub-hubs in such cities. This would boost the economy in these cities, help Jet Airways stand back on its feet fast, and support the overall vision of the Indian Government to promote aviation business through Tier 2/ Tier 3 Cities in India.

Not just that, Jet 2.0, as they refer to the plan, includes plans to increase cargo services to have a dedicated freighter service, calling it a market currently underserved by any Indian carrier and linking their thought process to India’s position as a leading centre for global vaccine manufacture.

The consortium said, they had evaluated the option of starting a new airline but some of the inherent strengths of Jet Airways like the optimal flight slots, brand value and reputation for best-in-class inflight service and safety, which gave Jet 2.0 an edge over others, were too tempting to resist. Hence they decided to re-energise and start Jet Airways on a clean slate with an established brand.

Commenting on the revival of the airline, Mr Manoj Narender Madnani, Board Member of Jalan Kalrock Consortium said,

“Jet Airways has been a brand with a glorious history of over 25 years, and it is the vision of the Consortium to put Jet Airways back in the skies at the earliest opportunity. We aim to re-energise the brand by infusing energy, warmth, and vibrancy into it while making it bigger and better. Over the years, the brand has created loyal customers and we wish to bring in freshness by adding value – an Indian brand with a global outlook, warm yet professional which symbolises the New India, Young India. With the revival of Jet Airways, it will restore the confidence among the Jet customers to fly again and experience its world-class facilities.”

The consortium says that the aviation sector was deeply hit by COVID-19, which helped as it underwent substantial correction and created that opportune time for the consortium members to enter the sector. The consortium’s biggest strength, they claim, is human capital, and it is putting together the best of aviation professionals with global experience for running and managing the operations of Jet 2.0.

The gap between the Sip & The Cup has never been larger.

Err, this statement put out by the new owners is overly simplistic and has no vision or details, apart from confirming that the airline will be a full-service carrier. Also, poor wording, with the choice of Jet 2.0. If they don’t intend to use the brand-name as Jet 2.0, then don’t use it in public statements as well. Beyond that, everything that the potential new owners said, looks like a wishlist to rather than a vision statement.

With no experience in running an airline, they need a proven CEO to get this airline back in the air and win the confidence of the industry partners before they even get out to get some passengers up in the air. I can understand if they have a crack team working behind the scenes and they don’t want to bring out the names just yet, but such a statement does not inspire any confidence in me, as much as I’d like to believe everything they said. It just sounds like GoAir, where the airline operates as laissez-faire and CEOs and COOs take the revolving door in and out, hence, before making any difference to the fate of the airline.

The expectation that they will get back all the slots, where other airlines are largely entrenched now, is to me, putting up a brave public face. It is not going to happen so quickly, and this could be the face-saving statement when things don’t work out, although that is not what I wish for them. The Consortium itself is not confident of this, as they say If everything goes according to plan. Two months after their winning bid, they don’t even have the keys to the door in their hands at the moment.

In an article published around the time the winning bid was announced, I said,

First and foremost, the airline will need to find themselves a management team. There is no certainty that ex-employees will return to the airline, and neither is there certainty that they will be absorbed. So, there has to be a good reason for anyone to take a leap of faith with the airline at this point.

Second, they need aircraft. From a fleet of 120 aircraft or so, the airline is down to 6 Boeing 777s, a handful of A330s and Boeing 737 aircraft. Clearly, if the airline wants to restart as a domestic airline, they will need to go and find them some aircraft. This could be an airline that prefers the A320s to the 737s, maybe? What if Jet Airways wants to call Boeing and say they want their 205 aircraft order back on the books. There are quite a few of undelivered 737 MAX aircraft in Jet Airways colours still there at Boeing’s facilities in Washington, USA, and aircraft redelivered to GECAS are stored there too.  Will Boeing take the call?

The new Jet Airways will have to work out a lot of things, for instance, the size of the cabin, the cabins they will operate with (J/Y or J/PEY/Y) and what will be the service standards, and will there be a loyalty programme or not and so on. While there has been some maintenance done on these aircraft, they definitely need work before they are airworthy.

Third, they need slots. Their prime bank of slots, domestic and international, has been given away. There might be some slots left, but most are gone and divided up between other domestic airlines. On the international front, it would be a long way before they can make any meaningful presence again. Although if they started with flying international first with those 777s, do they still have the rights to fly abroad in the first place? You need 20 aircraft in your fleet to be anywhere close to that restart.

Fourth, you need money, lots of it. Restarting this airline will need a lot of money in the upfront stage to invest in the product and the airline.

Fifth, you need luck. The Indian preference for no-frills airlines and buying at the cheapest cost is well-known. All it takes is to amp up the discounts a bit more, and most passengers switch to the lower price on the route, service be damned. So, if an airline continuously kept prices low, would you get on a Jet Airways plane or the other airline? Most people know the answer. So however they do they take on the competition, they need a bit of luck by their side.

Unfortunately, the consortium did not play their hand very well, and skipped the details, only writing up a boilerplate statement with a wishlist of what they’d like to do, without putting a timeline in place.

Bottomline

Jet Airways intends to return to the skies in the summer of 2021, as a full-service carrier. They are looking for the slot bank to be returned, and start afresh with three hubs in Mumbai, Delhi and Bengaluru. No details of how they intend to achieve any of this are at present available.

What do you think of the Jet Airways revival plan, referred to as Jet 2.0 by the potential new owners of the airline? Ambitious or … optimistic… or hubris? I wish them well though and here is hoping to flying Jet 2.0 sometime soon. 

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