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Rediff.com  » Business » Jet to use surplus aircraft on Gulf routes

Jet to use surplus aircraft on Gulf routes

Source: PTI
June 10, 2009 19:06 IST
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Under pressure to drastically cut costs, Jet Airways is in the process of reducing domestic capacity by 10 per cent and plans to utilise the aircraft freed from these cuts on high density routes of the Gulf and Saudi Arabia.

The premier private carrier, which has already reduced domestic capacity by 20 per cent to contain losses and survive the wrath of the global financial downturn, has also started the process of reducing it by another 10 per cent.

Commenting on the financial crunch facing the airline and the industry in general, Jet chairman Naresh Goyal said in Kuala Lumpur on Tuesday that the airline would slash its capacity by an additional 10 per cent after having cut 20 per cent.

Airline sources said several of its 50-strong fleet of Boeing 737s will be freed due to the capacity cuts, many ofwhich would be used for high-density routes like Jeddah and Riyadh in Saudi Arabia besides Gulf stations like Sharjah.

Without elaborating on how many aircraft could be freed,they said these Gulf and Saudi routes had a strong demand for air travel by Indian expatriates, with most of whom preferring low-fare services.

Maintaining that there was no move to defer the deliveries of the sophisticated long-range Boeing 787-8 Dreamliners, they said the deliveries were scheduled for 2013 and there was no need at present to delay their induction.

Jet Airways signed a deal with the US aircraft maker in 2007 to acquire 10 B 787-8s at a list price of $1.5 billion.

The airline, which has not raised capacity for the past three years after acquiring Air Sahara (now christened JetLite), was also not in a hurry to replace its leased aircraft fleet after expiry of their lease, the sources said.

In its bid to counter the plunging demand and over-capacity, Jet recently launched its second no-frill subsidiary airline Jet Airways Konnect, whose network grew to 62 destinations with the addition of 30 cities today. Most of these routes used to be served by the full-service carrier.

"There continues to be a latent demand for a quality, all-economy service on several key domestic routes," Jet CEO Wolfgang Prock-Schauer said.

Conceptually, Konnect was launched as a regional scheduled carrier as per the new rules which came into effect last year.

The new carrier flies to 62 destinations from major metros operating a fleet of three B 737-800s and 10 ATR 72-500s. The turboprop ATR aircraft carry between 70 and 80 passengers and, as per current rules, do not have to pay various airport and navigation charges which operators of larger planes have to pay.

Jet Airways suffered a full year loss of $79.3 million in the financial year ending March 31 this year compared with $63.1 million in the previous fiscal, according to the Centre for Asia Pacific Aviation.

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