JET Airways Case Study
What downed 9W ?
Jet Airways is an airline company from Mumbai, India. It was founded on April 1992 by Naresh Goyal. It was the largest privately help airline company at once. So let's check few reasons why JET Airways was grounded.
Mismanagement and Autocratic Structure
The boss of JET Airways i.e. Naresh Goyal made many decisions which were highly senseless and baseless. No one was allowed to do anything in that company. He kept all control in his hands and never allowed anyone to act.
Acquisition of AIR Sahara
Many experts say that JET did their biggest mistake by acquiring AIR Sahara. JET paid unnecessary 500 Million USD to SAHARA Group. As already JET was bleeding loss from starting and burning huge amount of cash.
Entry of Low Cost Carriers
When low cost carrier like IndiGo entered the market, JET couldn't adjust themselves into low cost carriers. As they were full service fleet with different versions of Boeing which was flying Domestically and Internationally. On the other side IndiGo understood the Indian market and operated accordingly. But JET couldn't.
No Profits, Only Cash Burn
JET Airways was majorly in LOSS since starting. They never focussed on profiting the company. They were paying huge amount of perks to their employees, which was unnecessary compared to other Low Cost Carriers. Also they were flying different versions of BOEING on both domestic and international roots. On other hand, IndiGo only operated with AIRBUS A320 Aircrafts.
Also fluctuating price of fuel and petrol was also the main reason. But that was same for all other carriers. JET never had a good management and planning. There operations were ceased on April 17, 2019 and all their aircrafts were grounded. Now many companies are using JET Aircrafts for their operations.
Recently JET Airways was acquired by Kalrock Capital and Murari Lal Jalan and its getting ready to make a comeback in Summers of 2021 with full fleet service carrier.