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Cash-strapped Jet Airways to get a new investor on board soon; airline's bids to trim costs underway amid pilots' salary woes

FP Staff
The loss-making Jet Airways has been defaulting on salary disbursement to its senior management along with pilots and engineer since August due to severe cash crunch.

Naresh Goyal-led Jet Airways will soon get a new investor on board to help fund the debt-ridden airline for staying afloat amid mounting financial problems, a top official of the company told its pilots at a meeting a week ago, said media report.

Top officials of Jet Airways, led by chief executive officer Vinay Dube, offered the assurance at a 26 November meeting with the pilots' union, National Aviator's Guild (NAG), said two people aware of the matter, requesting anonymity, reported Mint.

"Vinay Dube, who represented the management at the meeting, told the Jet Airways pilots that the airline will get an investor on board soon, likely within the next two-three months," one of the two persons familiar with the development was quoted as saying by Mint.

On December 2, Jet Airways had to cancel at least 14 flights to various destinations after some of its pilots reported "sick" over non-payment of their dues, sources said.

The loss-making private carrier has been defaulting on salary disbursement to its senior management along with pilots and engineer since August due to severe cash crunch. This development happened after the meeting between the airline's top officials including Dube and pilot over the latter's salary delay.

The airline has partially paid to these staff for September while the full salaries of October and November also remain unpaid.

"At least 14 flights have been cancelled so far due to some pilots reporting sick. They are protesting against non-payment of salary, dues and the indifferent attitude of the National Aviator's Guild in taking up the issue with the management," the source said.

The NAG is a domestic pilots body of Jet Airways, representing over 1,000 pilots.

Earlier on Monday, Jet decided to do away with complimentary meals for economy class passengers travelling on domestic routes under two more fare categories as the full-service airline is looking to trim costs in a bid to stem rising debt.

The revision in fare offerings will be effective for tickets booked from 21 December, for travel starting 7 January, Jet Airways stated in a release. The carrier currently offers five fare options in the economy class €" light, deal, saver, classic and flex €" for customers booking flights on domestic routes.

The latest revision in complimentary meals would be available only for economy passengers who booked their tickets under the flex option, the release said.

Jet Airways is seeking to reduce costs in several areas in its efforts to turn itself around. The areas include sub-fleet simplification, reduction in sales and distribution and maintenance cost, route rationalisation, renegotiation of contracts with vendors, among others, following three consecutive quarterly losses.

The airline is aiming to achieve cost savings of over Rs 2,000 crore over the next two years through strategic initiatives, its CEO Dube had said after the second quarter earnings.

€" With PTI inputs

Also See: Cash-strapped Jet Airways cancels 14 flights as pilots report 'sick' over non-payment of salaries

Jet Airways to clear September salary dues on 4 December; to come out with revised payment schedule soon

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