The Rise and Fall of Jet Airways: India's Once-Beloved Airline
Once India’s largest and most popular airline, Jet Airways has officially ceased to exist on account of the Supreme Court’s recent order to liquidate the airline under the Insolvency and Bankruptcy Code (IBC). This marks the end of a five-year saga to revive the carrier.
When Naresh Goyal founded the company in 1993, Jet Airways took to the skies after India liberalised its economy. Initially, it was backed by Gulf Air and Kuwait Airways, and the airline quickly gained popularity for its world-class service.
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As the major challenger to government-owned carriers Indian Airlines and Air India, Goyal allegedly used his clout and network to ensure rapid growth.
Jet Airways went international, expanding its domestic market share. Its successful IPO in 2005 solidified its position as a market leader, and people started trusting and loving the journey via Jet Airways.
However, new entrants like Air Deccan, SpiceJet, IndiGo, and Kingfisher Airlines changed Indian aviation. Jet Airways acquired Air Sahara in 2007 for over Rs 2,200 crore, which was a move many considered overpriced.
In recent times, Jet Airways faced numerous challenges that ultimately led to its downfall, and the major reason behind its turbulent end is linked to its financial woes. The airline struggled with mounting debt, reporting losses of over Rs 5,000 crore in 2018-19.
From there, the struggles piled up that the employees went without salaries for months, leading to protests and strikes, and Jet Airways faced fuel supply disruptions due to unpaid dues.
Jet Airways borrowed heavily in 2012, and the government’s FDI policy change allowed foreign airlines to own up to 49 percent stakes in Indian carriers, with Etihad Airways acquiring 24 percent of Jet Airways in 2013.
Additionally, Jet Airways struggled against IndiGo’s vast network and low-cost model. Allegations of fund syphoning surfaced, and in April 2019, the airline was grounded after the SBI-led consortium rejected its emergency fund request.
Announcement @JalanKalrock pic.twitter.com/23YQem58xZ
— Jet Airways (@jetairways) September 29, 2023
In 2019, Jet Airways suspended operations due to a lack of funds, leaving passengers stranded. Along with that, the airline faced a severe pilot shortage, with many quitting due to unpaid salaries. Airports later refused to allow Jet Airways flights to take off, resulting in delays due to unpaid funds.
In 2023, Jet Airways founder Naresh Goyal was arrested by the Directorate of Enforcement (ED) in a Rs 539 crore money laundering case. This was filed by the CBI based on the complaint from Canara Bank that the bank has sanctioned credit limits and loans to Jet Airways (India) Ltd. (JIL) to the tune of Rs 848.86 crore, of which Rs 538.62 crore is outstanding. Syphoning or illegal transfer of loan money that was taken for airline operations was also traced out.
The airline faced scrutiny from regulatory bodies, including the Directorate General of Civil Aviation (DGCA), and founder Naresh Goyal stepped down as chairman, and Etihad Airways reduced its stake. Multiple attempts to revive the airline, including a proposed takeover by the Jalan-Kalrock Consortium, were jinxed.
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Once Naresh Goyal said he had “lost every hope of life” and it would be “better if he dies in jail” than living in his present condition. However, the Indian aviation industry will remember Jet Airways as a pioneer that lost its way and hopes “The Joy Is Coming Back.”
It sure is!
Your favourite ‘imli candy’ is coming back soon on all Jet Airways flights!
Tell us what’s your ‘imli candy’ story.😀 pic.twitter.com/XMEwYfvndW
— Jet Airways (@jetairways) August 25, 2022
