Swati Kektar speaks to Ankit Jalan, board member of the Jalan-Kalrock Consortium, the new owner of Jet Airways, to delve deeper into plans for revitalising the fallen Indian carrier.
Launched in 1993, with its fleet of 124 aircraft. Jet Airways flew to over 65 destinations in India and around the world before suspending operations in April 2019 after failing to raise sufficient funds to continue flying. After a long hiatus, the Indian aviation sector is now eagerly awaiting the relaunch of Jet Airways.
The National Company Law Tribunal (NCLT) has approved the transfer of ownership of Jet Airways to the Jalan-Kalrock consortium (JKC, the new owners comprising of a consortium of Murari Lal Jalan and Florian Fritsch of Kalrock Capital) and has also extended the deadline to clear outstanding debts.
The Supreme Court of India has directed the new owners to pay the provident fund and gratuity dues of the former employees of Jet Airways which amounts to $33 million.
Despite the ruling and ongoing challenges, the Consortium and management team of Jet Airways have adopted a “never-say-die” attitude and have spent a considerable time and expense reviving the airline and now there is no turning back. A stance affirmed by Ankit Jalan, a board member of JKC.
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Ankit Jalan, a board member of JKC.[/caption]
The staff are more than prepared and excited for the launch of the new airline, which Jalan says has a new “game-changing” business plan. “We will reveal the specifics at the right time, as it is competitively sensitive information,” he says. “However, it may suffice to say, it is not a copy-paste of other Indian airline business models, whether a full service carrier (FSC) or a low-cost carrier (LCC). It breaks the mould and addresses key gaps in terms of both strategy and customer value proposition, as well as in terms of customer experience. We believe our customer value proposition can fundamentally change the airline-customer relationship in India from one that is currently often adversarial, to one that is positive and a win-win for both.”
The management says that it is ready to launch within 60-90 days following the transfer of ownership. “We have put into place a highly experienced, professional management team, and negotiated excellent terms for our various supplier contracts that can often be critical in this industry,” says Jalan. “We have LOIs (Letters of Intent) in place for aircraft, engines, IT systems, ground handling services, catering, call centre, and all of the other services required to run an airline. The terms we have negotiated – drawing on the collective experience of Jet Airways of the past as well as the experience of our talented team drawn from multiple Indian and foreign airlines – will help Jet Airways in its revived form to be one of the most cost-effective airlines in the country,” he added.
A new aircraft order?
Although rumours of negotiations between OEMs and Jet Airways management are making the rounds, no firm order has been placed so far. “Starting or restarting an airline is a complex business, and we want to be sure we take the time to get the best possible terms and contracts for both aircraft and engines, including maintenance contracts, and to ensure we receive aircraft configured the way we want," the statement from the new owners said. “If that takes a little more time to get right, that’s fine with us."
Indian skies are dominated by Airbus A320 aircraft. Experts full of opinions about the right kind of aircraft type for Jet Airways. When Jalan was probed about the ideal aircraft type for Jet Airways he said: “We are working on small, medium, and large narrowbody aircraft. Our fleet strategy is not a “copy-paste” one either. Apart from allowing us to reimagine the network that an airline in India can build over time, it is also designed to positively alter how travellers in India think of flying.”
Speaking about the desired aircraft class configuration, he added: “We have a very innovative plan for the cabin configuration. As a modern, new-generation full-service carrier, we will not simply follow what has conventionally been done by airlines in India. We will challenge the status quo. We aim to set new standards in terms of product and services. We will reveal more at the right time.”
There have also been reports of unresolved negotiations between the carrier and engine and aircraft manufacturers that are believed to be further delaying the launch plans. Jet Airways reportedly wants engine makers Pratt & Whitney or CFM to bear a larger share of the costs whenever an engine is replaced. New engines like P&W's GTF and CFM's Leap are now being replaced more frequently than their predecessors, especially in the environmentally harsh conditions in India.
JKC declares that it remains fully committed to the revival of Jet Airways and that all payments will be made in full compliance with the court-approved resolution plan, a stance affirmed by Ankit Jalan.
The Jet Airways approved resolution plan indicates that JKC intends to restart operations with six aircraft, with plans to build a fleet of approximately 100 aircraft in five-to-seven years post launch. The airline also intends to start international operations as soon as it reaches the 20 aircraft fleet minimum as mandated by the Indian government.
Jet and fierce market competition
Launching the revived airline will be only the first hurdle to overcome for the new owners and management of Jet Airways. Gaining a meaningful share of the domestic Indian market, and then the international market from the country will be arguably even higher hurdles to clear. With a revitalised Air India to contend with and the mighty IndiGo, the marketplace is fiercely competitive. International airlines too from the Middle East, the Americas, Europe and South East Asia are all increasing their presence in the country as demand once more ramps up heating up competition even further.
When asked about how he intends to deal with the competition and attract customers, Jalan said: “In a market-driven business, there are two primary ways to compete: through scale, or through differentiation. We will naturally not have the scale when we start up. We will have lots of meaningful innovation and differentiation, and that will be the foundation of our success.”
Major pain points for Indian air travellers include affordability issues but also the general inconvenience or difficulty of travel mainly caused by a lack of modern technology as well as the woeful on-time performance, with delays mainly due to airport congestion. Jalan said that the new airline would face these issues head on. “Our approach to running Jet Airways will address the majority of these pain points by challenging and changing the status quo,” he says. “Customers will not be viewed as ATMs or cash machines, where they are charged every time, they move. We will break the mould completely, while still creating value for all stakeholders.”
With evident enthusiasm for the vision of Jet Airways, Jalan added: “We will build the most people-focused and customer-friendly airline that is in tune with the demands of the digital age. We are determined to pay more than lip-service to the term “digital”, and ensure we take care of the basic needs and pain-points of all stakeholders consistently and reliably using a combination of human intervention and technology working in sync. Jet Airways will not only differentiate but also find new ways to win travellers over.”
He adds: “We cannot wait to reveal what we have planned. We will need for the ownership transfer process to be completed before we can reveal and execute on our plans.”
“Jet Airways will be all about customers”
Jet Airways promises to incorporate a number of elements to ensure the transformation of the customer experience, from more effective training and role-playing, improvement in frontline morale through greater communication and engagement, to attention to detail and effective feedback mechanisms, Jet Airways promises to use of these and more.
The airline promises to take the best of the original Jet Airways airline, including qualities such as elegance, customer focus, and warmth in service delivery, while weeding out the unproductive costs and inefficiencies that had crept in over time. “There is no need to fix what is not broken,” Jalan says.
The Jet Airways management team aims to build a brand that customer will want to book and fly with time and time again, rather than have customer treat the experience as something to simply tolerate, if not dread.
The successful launch of Jet Airways would be a story straight out of an aviation fairy tale, where finally the airline takes to skies having cleared all obstacles. Currently there are substantial hurdles to overcome, with new problems cropping up every week. Experts in the industry opine that it would have been wiser to start a new airline rather than revive an old and complicated carrier stuck in a legal tangle. To this Jalan smiled, as if this question was long anticipated and gave a confident reply: “Starting a new airline is – without doubt – much easier, but to go down the easy path is not always the best choice. To build a brand as loved and respected as Jet Airways is far from easy. The credibility that Jet had built over 25 years is truly remarkable, and we wanted to tap into this incredible opportunity, revive the brand, and build on it by addressing today's evolved demands and realities.”
It has never been done before in India, and millions of travellers are waiting for Jet Airways to take to the skies again. But it certainly won’t be an easy ride. Once the legal formalities are over and Jet Airways is set for launch experts feel that in the extremely volatile Indian civil aviation sector the airline will need extensive planning, adequate capitalisation and a clear and well-defined strategy to survive. Here’s wishing Jet Airways a successful launch and clear skies ahead.