Bludgeoned by falling profit margins and low passenger loads, Jet Airways has reduced its overall capacity by nearly 30 per cent and has also chosen not to take delivery of 10 Boeing 777 aircraft with which it was planning to operate on the international sector, Chairman Naresh Goyal said on Tuesday.
“We had ordered 20 Boeing 777s of which 10 aircraft were options. We are not not exercising these options and have decided to pull out aircraft from routes where we had multiple frequencies,” Goyal said on the side lines of an industry conference here.
Following the global economic slump and a drastic fall in traffic on both domestic and international sectors, Jet would now operate an Airbus 330 (220 seater) instead of the Boeing 777 (312 seater) to sectors including New York.
It will now run a 138-seater Boeing 737 aircraft on the Mumbai-Dubai sector instead of the larger Airbus 330. The airline has also withdrawn the Airbus 330 and is now operating the smaller capacity Boeing 737 on the Chennai-Singapore sector.
“We are also looking to reduce frequencies in the domestic sector where we already have multiple frequencies. This will help us better capacity utilisation and also help us get yields per seat,”Goyal said.
{{/usCountry}}“We are also looking to reduce frequencies in the domestic sector where we already have multiple frequencies. This will help us better capacity utilisation and also help us get yields per seat,”Goyal said.
{{/usCountry}}Low-priced tickets has slashed yields.
“If we do not go in for capacity reduction we will not survive and the industry will have to go back to the monopoly days,” a visibly worried Goyal said. “Every airline is on a ventilator and we will have to do something very fast to the industy back into the general ward.”
Domestic airlines have cut capacities by more than 20 per cent in the last eight months on falling demand. The debt-ridden industry is estimated to have lost nearly Rs 10,000 crore in 2008-09.