JOIN USTurbulence awaits as Jet Airways takes new flight
After being grounded for two years, Jet Airways is all set to soar high, piloted by Murari Lal Jalan. The airline will start its operations from the next financial year, the company said in a statement.
This comes after the airline was taken to the insolvency tribunal, the National Company Law Tribunal (NCLT), for resolution during which Murari Lal Jalan led Jalan Kalrock consortium bought the airline.
Even though the airline seems to have survived the bad weather, the runway for the carrier to take flight again is not entirely clear yet. Here are some of the challenges that lie ahead of Jet Airways before its first flight takes off from New Delhi to Mumbai next year:
Missing fleet
Jet Airways 2.0 plans to have over 50 aircraft in three years and over 100 in five years, which also fits perfectly well with the short-term and long-term business plan of the consortium. However, it is yet to finalise the aircraft that it will operate, according to a report by The Indian Express.
“The aircraft are being selected based on competitive long term leasing solutions,” Murari Lal Jalan said. The airline’s acting CEO Captain Sudhir Gaur said: “We will start with domestic operations on an all narrow-body aircraft fleet leased from major global aircraft lessors who have approached us, and with whom we continue to engage”.
The airline is still negotiating for slots and parking spaces with airport operators. “The process of reviving the grounded carrier is on track with the existing Air Operator Certificate (AOC) already under process for revalidation. The consortium is working closely with the relevant authorities and airport coordinators on slot allocation, required airport infrastructure, and night parking,” the airline said in the statement.
The lost workforce
The airline has already hired over 150 employees and plans to induct more than a thousand in this financial year. The airline's human resource department could face some difficulties in hunting for critical staffers such as pilots, cabin crew, network planners, etc.
Meanwhile, the employees of erstwhile Jet Airways have approached the National Company Law Appellate Tribunal (NCLAT) seeking quashing of the NCLT's approval of the resolution plan of Kalrock-Jalan consortium. The employees had rejected the resolution plan. In the voting process of employees, only 35.1 per cent approved the plan while 3.2 per cent rejected it, and 61.6 per cent abstained from voting.
In a plea, the Bharatiya Kamgar Sena (BKS) and the Jet Airways Cabin Crew Association had cited concerns on unpaid salary dues and continuity. The admitted claims of employees stood at Rs 1,265 crore, while the consortium has proposed Rs 52 crore to settle their claims. Following which, the NCLAT had reportedly given time to the counsel of Kalrock-Jalan consortium to respond to concerns raised by employee associations around the resolution plan.
Following the airline’s grounding, several hundred employees had dues pending ranging between Rs 3-85 lakh each, but as a part of the revival plan, the consortium offered employees a settlement of Rs 23,000 each, which several employee unions rejected. On a consolidated basis, employee claims worth Rs 1,265 crore were admitted and the consortium proposed Rs 52 crore to settle their claims.
According to employees, the airline owes at least Rs 3 lakh to each employee which may well go up to Rs 85 lakh, while now each employee is being offered a total of around Rs 23,000.
Another challenge
Another challenge that lies before the airline is Punjab National Bank's (PNB's) plea at the appellate tribunal seeking to quash the rescue plan. The bank is aggrieved by the reduction in its claim amount by around Rs 202 crore by the Resolution Professional, which according to it is in complete violation of the processes as enumerated under the Insolvency & Bankruptcy Code (IBC). An NCLAT bench has issued a notice over the PNB's petition along with its interim plea seeking a stay over the execution of the resolution plan.
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