Jet to fly different route for growth

Jet Airways, one of the leading Indian private carriers, is not looking to expand at the same rate as it did a couple of years ago. The company is, instead, planning a more consistent growth strategy going forward, said a senior Jet Airways official. “In 2007-2008 we expanded like there is no tomorrow. This is not the same Jet Airways anymore. When we expand, it will be to strengthen the network contribution to the company. The routes we expand to should be those where we have a chance to become profitable in three to six months nothing more than that,” Jet Airways’ Chief Commercial Officer, Mr Sudheer Raghavan, told.  According to Mr Raghavan, long-haul routes (international) traditionally take 18-24 months to become profitable, and Jet, does not “have the appetite or the wherewithal” for such a long gestation period. While he did not elaborate on whether these routes will be domestic or international, Mr Raghavan said the strategy ahead could also be increasing frequency or “the gauge” on routes that the airline already operates on. “One way of improving our revenues is to add more capacity on routes where we have already established our presence as opposed to opening brand new routes. Brand new routes are riskier than increasing capacity on existing routes. So, growing need not always mean newer destinations, it could also mean growth on existing routes,” he said. In the last 18-24 months, the company has addressed its cost issues very strictly, he said. Without making additions to cost like manpower, the carrier managed to take its passenger volumes up. “At the time of the start of this two-year period (last two years of global economic crisis), our staff strength was 13,600 people, today it’s about 11,300 so we knocked off 2,000 not by retrenchment… but we didn’t fill the positions left vacant with attrition,” he said. Turnaround of JetLite and introduction of Jet Airways Konnect in 2008 also helped the carrier increase its passenger volumes without making an addition to capacity. NEW SERVICES “We launched our new services to the Gulf and other places (with the existing capacity). So we took all that additional passengers and increased flights without increase in manpower. We tightened our belts as we went through this period. By introducing Jet Konnect we increased the number of seats in the cabin so our cost per available seat kilometer came down,” he said.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).