Jet to fly abroad as margins squeeze
The domestic carrier is eyeing new destinations like South Africa, Canada, the Middle East and China.
By TNN |
KOLKATA: Jet Airways is stepping up its international operations following mounting pressure from domestic rivals and a need to further strengthen its market share. The domestic carrier, which already controls about 32% of the fast-growing Indian aviation market, is eyeing new destinations like South Africa, Canada, the Middle East and China.
The domestic airline already flies to Britain, Singapore, Kuala Lumpur, Colombo and Kathmandu. It now plans to launch daily flights to Bangkok in January, and is also awaiting regulatory approval to fly to the United States.
“The Asean region is a growing market and very profitable,” Mr Wolfgang Prock-Schauer, chief executive officer, told newspersons at a meeting held in Kolkata on Monday.
Jet Airways’ turnaround strategy entails expansion of its international operations as well as increasing earnings from it. International operations, which accounts for 17 % of Jet Airways’ overall revenue now, will make up half of its revenue by 2008-09 once Jet enhances its fleet and adds more overseas routes, Mr Prock-Schauer added.
Elaborating, the Jet CEO said with the fleet strength going up to 90 from the existing 58 by 2008-09 fiscal following completion of the airline’s planned US $ 2.5 billion fleet expansion plans, several new destinations in north America, Europe, south Africa, Kenya, China and Asean countries will be connected.
“The aim is to make the revenue ratio in international and domestic sectors 50:50 from the present 17:83 basis. Our expansion will, however, be purely on market requirement,” he said.
Jet Airways intends to invest substantially over the next three years in new aircraft and training, and has said it would cut costs through greater online ticket sales and better staff management.
India’s domestic aviation market is expected to grow at about 20 % a year over the next five years. Though the domestic aviation industry will soon witness a shakeout, Mr Prock-Schauer hoped that Jet Airways comes out of it unscathed although it has suffered losses in the first half of the current fiscal.
“Nobody wants to lose so much money on a continuous basis. Either some airlines will close down or capacity induction will slow down. We are in a special phase and there will be a shakeout,” Mr Prock-Schauer said.
Although fuel cost and lower load factor were also responsible for the losses in the first half, he said things have started to look up. “We are seeing light at the end of the tunnel. Fuel prices have come down and we also moving into peak season,” he said, adding, “I don’t want to be too optimistic, but we are moving to break-even position and it will get better if the market grows.”
The domestic airline already flies to Britain, Singapore, Kuala Lumpur, Colombo and Kathmandu. It now plans to launch daily flights to Bangkok in January, and is also awaiting regulatory approval to fly to the United States.
“The Asean region is a growing market and very profitable,” Mr Wolfgang Prock-Schauer, chief executive officer, told newspersons at a meeting held in Kolkata on Monday.
Jet Airways’ turnaround strategy entails expansion of its international operations as well as increasing earnings from it. International operations, which accounts for 17 % of Jet Airways’ overall revenue now, will make up half of its revenue by 2008-09 once Jet enhances its fleet and adds more overseas routes, Mr Prock-Schauer added.
Elaborating, the Jet CEO said with the fleet strength going up to 90 from the existing 58 by 2008-09 fiscal following completion of the airline’s planned US $ 2.5 billion fleet expansion plans, several new destinations in north America, Europe, south Africa, Kenya, China and Asean countries will be connected.
“The aim is to make the revenue ratio in international and domestic sectors 50:50 from the present 17:83 basis. Our expansion will, however, be purely on market requirement,” he said.
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Jet Airways intends to invest substantially over the next three years in new aircraft and training, and has said it would cut costs through greater online ticket sales and better staff management.
India’s domestic aviation market is expected to grow at about 20 % a year over the next five years. Though the domestic aviation industry will soon witness a shakeout, Mr Prock-Schauer hoped that Jet Airways comes out of it unscathed although it has suffered losses in the first half of the current fiscal.
“Nobody wants to lose so much money on a continuous basis. Either some airlines will close down or capacity induction will slow down. We are in a special phase and there will be a shakeout,” Mr Prock-Schauer said.
Although fuel cost and lower load factor were also responsible for the losses in the first half, he said things have started to look up. “We are seeing light at the end of the tunnel. Fuel prices have come down and we also moving into peak season,” he said, adding, “I don’t want to be too optimistic, but we are moving to break-even position and it will get better if the market grows.”
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