Jet Airways has informed its employees that the airline will be unable to fly beyond 60 days unless cost-cutting approach including pay cuts will be followed. Investors are about to sell their stake according to media reports.
The management team, the chairman Naresh Goyal has informed employees in face-to-face meetings in recent days in Mumbai and Delhi that the airline’s financials are in a bad shape and drastic measures needed to be taken to cut costs.
Pilots who have refused the 15 percent pay cut for 2 years had been informed that the airline was running out of time to operate without raising revenue.
Employees are protesting this and trying to judge what to make of these warnings as the situation can make some employees leave their jobs.
“We have been informed that the airline cannot run beyond two months and the management needs to cut cost through pay cuts and other means to ensure that it stays afloat beyond that. The airline did not inform us about all this all these years which has dented the trust of employees in the management,” said one of Jet Airways senior executive.
The airline is looking for working capital loans but banks want the airline to show a turnaround commitment and for this Jet Airways has said that salary reduction was part of the same issue. Jet Airways is implementing several measures to cut cost and as a part of this initiative, the management is in talks with key stakeholders for their full support and cooperation. Rising fuel prices and major market share gains by IndiGo are the major reasons for the financial position of Jet.
This can be very bad news for the brand reputation of Jet Airways as IndiGo has recently reported an impressive jump of 97 percent in profit on Monday.
Do you believe such announcements can strike a big dent on the trusted customers of Jet Airways? Do let us know in the comments section.
