Jet Airways may take a year to fly again

Jet Airways may take around a year to take to the skies again after a bankruptcy court approved a revival plan for the grounded private-sector carrier that was once the leader in the Indian market.The new owners of Jet, a consortium of UK-based investor Kalrock Capital and Gulf businessman Murari Lal Jalan, will need to seek several approvals and clearances before it takes to the skies again.These include the air operator’s certificate, security clearances, flight slots and bilateral air traffic rights of Jet that have either lapsed or been reallocated to its peers. What’s more, it will have to apply afresh for arrival and departure slots.“It will be very difficult,” said a person close to the development. “Retaining the Jet brand and company structure will possibly help the new owners get security clearances etc., faster than usual. But taking it back to the skies won’t be easy at all. I also think the money being invested isn’t much. It will most likely start with 4-5 airplanes and then try to scale up gradually,” said the industry official.Furthermore, the macro environment isn’t the best for an industry like commercial aviation.“The aviation industry has been impacted the most in this pandemic. Demand has revived somewhat in the third and fourth quarters of FY21 but has been hit again because of the second Covid wave,” said Kinjal Shah, vice president at ICRA. “In such a scenario, a new airline will only increase the competitive intensity, which won’t be beneficial at all for the industry.”But some others were more positive.“The court order is a massive clean-up - surprisingly- and will allow the new promoters to develop a viable business case subject to a significant capitalisation,” said Kapil Kaul, CEO, South Asia at CAPA Centre for Aviation.Kaul also said it wouldn’t be challenging for Jet to secure slots as many are lying unused due to low demand.Jet stopped operating on April 17, 2019. A show-cause notice was sent to it by the Directorate General of Civil Aviation (DGCA) for suspending its air operator’s certificate. That suspension was stalled because of the corporate insolvency proceedings against it at the National Company Law Tribunal (NCLT).The new owners of Jet will now be assessed for substantive ownership and effective control, and its directors and key personnel would require a security clearance. Operational aspects, including training and maintenance, will also have to undergo a complete recertification process.When Jet stopped operations, the DGCA had reallocated its flight slots to peers temporarily. Jet’s counsel had appealed in court that the insolvency proceedings protected these slots, and they should come back to Jet. The NCLT quashed this appeal.

from Economic Times https://ift.tt/3wQt80Y