Zero Cash & No Fuel, Jet Airways May Shut Down Soon: A Timeline Of Events
Jet Airways is facing a severe cash crunch and is unable to pay its employees their due salary for the last three months. With a critical meeting today to decide the possibility of shutting down, Jet Airways might join Kingfisher on the infamous list of airlines that have ceased operations, effective from 17th April 2019.
Timeline of the turbulence
- Jet Airways participates in aggressive cost-cutting measures to meet competitors IndiGo, SpiceJet and slashes flight prices.
- Crude oil prices are on the rise.
- In the last 11 years, Jet Airways has seen profits only in two years, 2016 and 2017.
- Possible salary cut up to 25% for employees on account of rising crude prices and the falling rupee.
- Three consecutive quarters reported heavy losses for Jet Airways
- Jet Airways defaults on loan repayments.
- Rs. 76 crore loss reported in the financial year 2018.
- 14 pilots bail out on Jet Airways
- At least 36 employees have been laid off.
- Employees stop receiving salaries completely.
- Jet Airways approves bailout plan: State bank of India (SBI) led bank consortium to be the major stakeholder
- Naresh Goyal’s stake to drop from 51% to 25%, Etihad from 24% to 12%
- Jet Airways also approves to allow lenders to convert debt to equity.
- Jet Airways faces $1.2bn of net debt; operational fleet shrinks from 123 planes to just 41
March 25, 2019:
- Jet Airways’ Board approves resolution where State Bank of India would lead lenders to infuse Rs 1500 crore immediately to the save the airline.
April 2019 :
- Jet Airways operational fleet shrinks to 7. If the fleet strength goes below 5, Directorate General of Civil Aviation (DGCA) can cancel Jet Airways’ Airline operator licence.
- International flights have been cancelled till April 18th.
April 12, 2019:
- Etihad Airways, TPG capital, Indigo partners, Naresh Goyal’s Jetair with Future Trend Capital convey Expression of Interest (EoIs) in investing in the troubled airline. NIIF (National Investment and Infrastructure Fund) to bid directly.
April 14, 2019
- Pilots in association with National Aviators Guild (NAG) plan to go on a strike on April 15 until salary dues are met.
April 15, 2019:
- The Strike is deferred, and operations continue.
- Urgent Investors meeting proves crucial for the release of Interim funding of Rs.1000 crores.
- Debt total is at Rs 8,000 crore.
April 16, 2019:
- April 15th Interim funding meeting does not prove forthcoming, funding is not released.
- Board meeting of Jet Airways to discuss the possibility of shutting the airlines down.
- 20,000 employees could lose their livelihoods.
- Naresh Goyal withdraws from the bid.
“We are still hopeful,” says Captain Raman Sharma on asked as to why pilots haven’t quit. The bidding of private players led by SBI is the only hope left for the iconic passenger airline.
20,000 employees face the threat of unemployment. With the election wave gripping the nation, the sudden increase in unemployment will reflect poorly on the Modi Government. The Pilots now intend to appeal to the PMO (Prime Minister’s Office) and hope the intervention will bring Jet airways back to operational status. Captain Rohit Chowdhary, working with Jet Airways said that the strike deferred on April 15th will now take place on the 18th of April. It will be a peaceful appeal lead by the Pilots, requesting the Government to take action. As of now, the fate of the 27-year-old airline hangs in the balance.