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Biz Barometer

Nearly 20,000 were left jobless after the Naresh Goyal-founded airline ceased operations, flying its final flight from Amritsar to Mumbai. Goyal, who had, in a letter on March 25, raved about his staff's contribution to help build the airline, is now, ironically, being held responsible for its closure.

Here is some relief coming in for the staff of Jet Airways, which has grounded its operations on April 19, after lenders refused it emergency funds to keep its operations going. Jet's rival SpiceJet has absorbed nearly 1,000 of the former's staff, according to SpiceJet chairman Ajay Singh.

According to reports, Lowe's India - the technology products and solutions centre for Lowe's Companies, Inc, a retail firm specialising in home improvement - has offered to recruit employees from Jet's IT division. US-based co-working operator WeWork, meanwhile, has said it will 'actively consider' job applications from Jet staff for openings across marketing, community management and sales.

Certain start-ups like CureFit have also offered jobs to Jet Airways staff on a priority basis. Nearly 20,000 were left jobless after the Naresh Goyal-founded airline ceased operations, flying its final flight from Amritsar to Mumbai. Goyal, who had, in a letter on March 25, raved about his staff's contribution to help build the airline, is now, ironically, being held responsible for its closure.

Many believe his refusal to give up control over Jet earlier, led to delay in reaching a resolution with lenders, ultimately leading to its closure. They say Goyal cleverly managed to sneak out of the airline, and step down as Chairman, leaving the struggling airline in the hands of the lenders. The grounded airline's CEO, Vinay Dube, told staff that all efforts by the airline's top leadership to get lenders to release some funds to pay staff salaries went in vain. This is a clear signal to all Jet staff that they needed to take up opportunities elsewhere.

Jet Airways would have needed Rs 400 crore of emergency funds to keep afloat, albeit with minimal operations.

Just before it shut down, Jet was operating only six planes, down from a peak of 119. It will be extremely difficult to revive Jet Airways now, since India's experience with Kingfisher Airlines shows that once grounded, an airline may not resurrect.

Just as the staff, lessors are yet to be paid. Other airlines are already eyeing Jet's planes and staff. What is an airline company without its staff and planes? Its market valuation keeps plunging by the day. From a yearly high of `650 on April 30 in 2018, the Jet Airways stock crashed to `132 on April 22, 2019.

And its market capitalisation is just around Rs 1,900 crore.

Jet's demise does not augur well for the airline industry. At a time when passenger traffic has been growing year-one-year at 13 per cent in October 2018, sudden cancellation of airlines has put passengers in a quandary. With the upcoming holiday season, the situation could worsen. It is not as if other airlines are doing well.

There have been reports of Indigo battling shortage of pilots and cancelling many flights in March. It was also hit by problems with Airbus 320 neo planes.

A Parliamentary Standing Committee in its report tabled in the Rajya Sabha in December 2018, pulled up IndiGo for its alleged mistreatment of consumers.

State-owned Air India is riddled with debt and losses. On April 26, passengers of Air India were left stranded after its check-in software reportedly topped functioning for around six hours, affecting as many as 137 flights. It's going to be a turbulent ride for the aviation sector this year.

(The writer is Executive Editor, India Today.)