case study on Jet airways what went wrong with the airline ? what should have been done

1. z
CASE STUDY ON
JET AIRWAYS

2. z
COMPANY HISTORY
 Founded in 1st April 1992 by Naresh Goyal.
 In the third quarter of 2010, Jet Airways became the largest
airline in India with a passenger market share of 22.6%.
 Company had a fleet of 124 aircraft.
 Employees Count 16,000.
 Ceased operations on 17 April 2019.

3. z
-10000
-5000
0
5000
10000
15000
20000
25000
2002 2004 2006 2008 2010 2012 2014 2016 2018 2020
Revenue
Time
Bivariate Analysis of Profit and Revenue
Revenue
Profit

4. z
Time Line
Aug 3
2018
• Jet Airways dismissed media reports of not having enough funds.
Aug 11
• SBI puts Jet Airways on watch list of DGCA
Aug 27
• Cut down of cost by over 20 Billion in 2yrs.
Sept 6
• Media reported non payment of salaries to employees.
Nov 5
• Tata Group looks acquiring 51% and merge airline.
Dec 5
• Etihad Airways talks to Jet's banker for rescue.

5. z
Jan 1 2019
• Delayed Payment to SBI let Consortium
Jan 11
• Etihad backs out
Jan 17
• Consortium plans of resolving debt issues
Feb 8
• grounded 4 aircrafts due non service of debt
March 25
• Mr. Goyal steps down, lenders pump in Rs 15 Billion
April 11
• Fleet size reduced to less than 20.
April 15
• Does not gets interim funds, plans to extend suspension of international flights
April 17
• Suspends its operations.

6. z

7. z
Reason for failure
 Commodity Prices
 Purchase of Air Sahara $500M in full Cash deal
 Poor Management
 Low cost Carriers were Underestimated
 Failure to find an investor
 Started Price war

8. z
Commodity Prices

9. zPurchase of Air Sahara $500M
in full Cash deal Poor Management

10. z
Low cost Carriers were
Underestimated Failure to find an investor

11. z
What should have been done
 Create a hedge against commodity prices.
 Sale of Air Sahara(Jet Lite) to get partial liquidity.
 Lease Air carriers rather than owning them.
 Negotiate airport fees.
 Change management to build investors trust.

12. z
THANK YOU