Jet Airways: parked planes, 20000 families, bleeding shares, haggled customers and bad news

Last Updated: Thu, Apr 18, 2019 15:58 hrs
Save Jet Airways (Image Courtesy: IANS)

Jet Airways needs immediate funds. At least to the tune of 1000 crores [Rs 983 crores according to CEO] to be able to save some jobs and restart operations.

Late Wednesday night [17th April 2019], Jet Airways was reported as having temporarily shut down operations on its domestic and international flights.

The airline later confirmed that the 10:30 PM flight was indeed the last one. This, because the Jet Airways management had no money left in its accounts. Also, it's lenders had refused to provide interim-funds necessary to fly.

No soon had the reports surfaced, employees, share-holders and the general public including users of this portal and twitter shared their concerns and some even shared their prayers for the staff of Jet Airways.

Jet Airways has 20,000 employees. Official count says that 15% of pilots and senior management were waiting three months of salaries. The entire workforce has not received salary for the month of March. Agencies say that the financial burden has affected many employees and some of them had to break their life-savings to sustain working. Some of them were reported as applying for jobs at rival airlines such as SpiceJet, IndiGo and Vistara at a nearly 30-50% drop in salaries.

Aviation regulator asks Jet Airways for revival plan

Investors and existing lenders too have claimed a difficulty in adding more funds. Debts have turned caustic. Into at least Rs 8100 crores piling on the balance sheets and bringing down stock valuations. An hour before end of trading on the Bombay Stock Exchange on Thursday, Jet Airways' stock plunged by at least 30%. The stock was down by 80.30 points at Rs 163.75 per share. In terms of volumes some 18.41 lakh shares had been sold and 70,000 shares being purchased. The number of shares sold is expected to rise, bringing the share price to its historical lowest.

However, the company's official letter to the Bombay Stock Exchange hints of a revival.

In its response to the exchange house, the airline said, "The Expressions of Interest (EOI) have been received and bid documents have been issued to the eligible recipients today [Wednesday]. The bid documents inter alia has solicited plans for a quick revival of the company. The bid process will conclude on 10th May 2019... We are actively working to try and ensure that the bid process leads to a viable solution for the company."

On Wednesday, Jet's CEO Vinay Dube remained hopeful of a take-off but wasn't sure if all 20,000 employees would be left with jobs. He wrote to employees, "we must also be realistic that the sale process will take some time and will throw up several more challenges for us, many of which we don't have the answer today."

"Late last night we were informed by SBI, on behalf of the consortium of the lenders, that they are unable to consider our request for interim funding of Rs 983 crores..."

"But, tomorrow is another day and tomorrow provides us with new hope, new opportunity and new expectations we are worth investing in, you are worth investing in and we are confident that we will be back to share the joy of flying with our fellow-guests once again," wrote Dube signing off on an emotional touch.

Latest reports say that of the four bidders, only one consortium has been left as a viable option. Besides demanding that Naresh Goyal be ousted completely from Jet, this consortium was also reported as seeking a 100% write-off on debts.

Air India keen on taking 5 grounded Jet Boeings

Whether Jet takes-off or not, the imminent losers are staff, customers and the share holders.

Our reader Ramnath G, shared his thoughts and prayed for a revival before Easter. He replied to our story on 20,000 jobs being lost.

"I have personally felt a sense of personal loss and sadness,at the nose dive of Jet Airways!I recall,nostalgically,the refuelling of the first Jet Airways Flight from Kolkata to Mumbai on 5th of May,1993,as GM of HPCL.East Zone.All that is left is a group photograph with the crew and cabin attendants,of the beleaguered airline.Jet Airways had attained,international standards,in terms of image,punctuality and inflight service.Its colour code,was akin to Lufthansa!!Hope there's someone coming forward to resurrect the Airline!What better time than Easter!!"

Here are some tweets on the fiasco.

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Here is an April 3 dated statement from Naresh Goyal.

Even as the last flight on Wednesday took off on an emotional note, Twitter trends on Thursday suggest the elections as biggest trend-setters. Mukesh Ambani getting featured on the TIME list too has been a top trending topic.