Jet’s grounding unfortunate, but also raises questions

While there had been some turbulence about Jet’s finances for over year, few would have thought the airline would get grounded

My attempt to visit Delhi this week for research on a long-planned project was quashed by the crisis that grounded Jet Airways. Just when I thought I had firmed up a ticket on the travel website, it crashed.

Jet Airways is only temporarily suspended, but that will be of little solace to employees and vendors, considering the fate of Kingfisher Airlines not too long ago. (HT File)

When I logged in again, the travel sites held up marvellously. But prices for flights had surged faster and stronger than an Andre Russell blitzkrieg in the IPL and no solution was forthcoming without causing serious damage to the bank balance. I am now waitlisted on a train to Delhi next week! Before the ‘open skies’ policy was introduced in India in 1991, getting to Delhi was almost always by train: largely for reasons of fare, but also because there were few options. Indian Airlines had a monopoly on domestic air travel. It wasn’t cheap and ruled by the cheerless, uncaring culture typical of government undertakings (this has changed remarkably in the past decade-odd for Air India because of competition), and wasn’t efficient or fun either.

Air travel in India changed dramatically post-Liberalisation, when the private sector was allowed into the business. The thrill and relief among travellers as East-West, ModiLuft and Damania took to the skies is still vivid in memory.

All three were fine airlines, loaded with frills and freebies, making the quality of air travel experience richer than ever before. The planes were new and plush, in-flight service excellent, and delays – so often the bane of the domestic airline – were effectively managed. My favourite was Damania Airways. It was an ambitious project put up by brothers Parvez and Vispi Damania from Dadar and captured the spirit of entrepreneurship that was quintessentially Mumbai: ambitious, classy, uncompromising on quality. Sadly, none of these airlines – for various reasons -- survived long. By the mid-1990s, all three were in the doldrums. However Jet Airways, which interestingly started shortly after these three, went from strength to strength.

Also headquartered in Mumbai, which made it a source of pride for a denizen of this city, Jet managed to overcome all challenges to become not just the front-runner among private airlines, but also standard-bearer of the industry, showing acumen, energy, vision and financial resourcefulness to combine efficiency with high quality service. As disposable income grew for middle class India, so did the volume of flights and business for Jet at the same clip. Rapidly, Jet became synonymous with air travel in India. The branding and PR was excellent, service personalised, aided by some delectable touches – like the tamarind candies – which was as effective at earning loyalty as the mileage plan.

The blue riband sector for the airline in its first couple of decades was Mumbai-Delhi and vice versa. Frequent flyers, I recall, would include film stars, businessmen, politicians, senior bureaucrats, not forgetting fixers and hustlers. Nowadays, the uber-wealthy, powerful and top-notch celebrities use their own personal planes or hire charter services. But not too long ago, a great deal of socialising, hobnobbing, and striking big-ticket deals happened on Jet flights.

In the last decade, budget airlines and ‘open’ pricing have thankfully made air travel easier, cheaper and more profuse. But this also meant severe competition and pressure on profit margins, making astute fiscal management imperative. The airline business is obviously perilous considering the number of airlines that have gone bust or merged with a larger company, though not necessarily to great advantage: East-West, ModiLuft, Damania, Deccan, Sahara, Kingfisher for example.

While there had been some turbulence about Jet’s finances for over year, few would have thought the airline would get grounded. It’s had its share of controversy, particularly about the source of funds when it started out, but had staved off that threat and was seen as an Indian ‘superbrand’ that could not be stymied. The fall has been hard because of the suddenness as well its steepness, bringing in its wake a great deal of hardship and trauma, particularly to 20,000 employees who now look ahead to a bleak future.

Officially, Jet Airways is only temporarily suspended, but that will be of little solace to employees and vendors, considering the fate of Kingfisher Airlines not too long ago. What’s even more foreboding is the frequency with which companies otherwise thought unassailable are collapsing. It raises questions about the competence of promoters/managements, financial institutions/banks/lenders involved, as well as the inability of the government to sense the extent of damage till it is too late for remedy.