Jet flies into biggest-ever quarterly loss of Rs 2,154 cr, names new CEO
Jet Airways, India’s second-largest domestic carrier by market share, on Monday reported its biggest-ever quarterly loss of Rs 2,154 crore against Rs 496 crore a year ago.business Updated: May 28, 2014 00:53 IST
Jet Airways, India’s second-largest domestic carrier by market share, on Monday reported its biggest-ever quarterly loss of Rs 2,154 crore against Rs 496 crore a year ago.
The Naresh Goyal-led airline, which has been without a full-time chief executive since January, also named Australian Cramer Ball as its new CEO, pending regulatory approvals. Ball previously worked as the CEO of Air Seychelles.
Jet, partly owned by Abu Dhabi-based Etihad, has not reported an annual profit since 2007. Its net loss during 2013-14 stood at Rs 4,130 crore, a nearly six-fold jump from the Rs 780-crore net loss reported in 2012-13.
Domestic airlines have been weighed down by expensive aviation turbine fuel or jet fuel prices, while slower economic growth has hit traffic.
The industry is set to witness more competition with budget carrier AirAsia India and full-service carrier Tata-Singapore Airlines gearing up to start operations this year. All Indian airlines except market leader IndiGo have been running into losses.
“Jet’s domestic business model continues to be structurally unviable. Etihad needs to take Jet turnaround more seriously than what is visible at present,” said Kapil Kaul, South Asia CEO at aviation consultancy Centre for Asia Pacific Aviation (Capa).
“There is nothing visible in terms of performance except the largest ever loss, which is almost 20% more than combined loss from 2006- 07 to 2012-13. Jet has hit a historic low in 2013-14,” he said.
“The way Jet is sliding its losses are almost equivalent to that of Air India,” said Rajji Rai, chairman, Swift Travel International Ltd.
The Jet board meanwhile named Cramer Ball as the next CEO. Ball, 46, was formerly the CEO Air Seychelles, another airline in which Etihad owns a stake.
The airline’s shares dropped 3.5% to close at `268 on Bombay Stock Exchange on Tuesday.