Aviation Secretary directed to review Jet Airways issue; Beleaguered carrier is losing $3,000,000 per day

Union Minister Suresh Prabhu on Friday directed Civil Aviation Secretary Pradeep Singh Kharola to review issues concerning Jet Airways and take necessary steps to minimise passenger inconvenience and ensure their safety. The decision comes in the backdrop of the beleaguered carrier’s decision to cancel its all international flights for Thursday night and Friday morning. It also grounded its services to and from to the east and northeast regions of the company, which left several passengers stranded at the airports. 

Jet Airways Fleet Size 

The airline that has been facing a financial crisis since February 2019 has a fleet size of 124 planes and was operating just 14 plans till Thursday. However, few reports suggest that "Jet will be operating only nine planes, including two Boeing 737s and seven regional Jet ATRs on Friday". 

Earlier, the airline’s founder and chairman, Naresh Goyal, stepped down, on March 25, 2019, due to the airline's financial crisis. 

Loss incurred due to Grounding 

According to a report published in Economic Times, Jet is making a daily Loss of $3 million. Besides, the airline has delayed salaries of its employees since October and defaulted on payments to vendors and lessors. The defaulted loans of the airline have triggered the sale process by the lenders.

Earlier on April 10, the aviation regulator, DGCA announced that it had de-registered seven Boeing 737-800 aircraft of Jet Airways. It also allowed its lessors to take the planes out of the country so that it can be leased to any other airline. The decision was taken on the request of Dublin, Ireland-based lessors, namely Allenwood Aircraft Leasing, Mardal Aviation, Crolly Aviation, Elphin Aircraft Leasing, Dungarvan Aircraft Leasing, Carlow Aircraft Leasing and

Ballyhaunis Aircraft Leasing. The lessors had put in the irrevocable deregistration and export request authorisations (IDERA) requests with the DGCA on the around April 3, 2019. 
Impact of Grounding of Planes 

The grounding of the planes by Jet Airways, which led to a sharp decline in the number of flights, has bullied the airfares on an upswing across India for the last few weeks. Following the skyrocketing in the fares, DGCA, earlier this week, asked all airlines to come out with an individual medium-term plan to enhance the availability of domestic flights by Wednesday. The move was aimed at curbing rising airfares. 

How the crisis is beneficial for other airlines? 

The crisis at Jet Airways and de-registering of its planes by DGCA have benefitted other players like Spice Jet, as, today, the company has announced that it will induct 16 Boeing 737-800 NG aircraft on dry lease. For the purpose, it has applied to DGCA for a No Objection Certificate (NOC) to import the aircraft. The company also added, “subject to regulatory approvals, the aircraft would begin joining SpiceJet fleet in the next ten days”. 

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If permitted, it will help Spice Jet in expanding its airline’s international and domestic presence as well as in bringing down the flight cancellations. Incidentally, the announcement comes at a time when airfares have been on an upswing across India, which was caused due to the grounding of more than 90 per cent of Jet Airways fleet.