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Cash-strapped Jet Airways cancels Abu Dhabi flights

Issac John /Abu Dhabi
issacjohn@khaleejtimes.com Filed on March 19, 2019 | Last updated on March 19, 2019 at 06.34 am
Cash-strapped Jet Airways cancels Abu Dhabi flights

All affected guests have been rebooked on to alternative flights.

Etihad Airways, which owns 24 per cent of Jet Airways, said on Monday (March 18) that all passengers affected by the abrupt cancellation of flights to and from Abu Dhabi by the cash-strapped Indian carrier had either been rebooked onto alternative flights or offered refunds.

An Etihad spokesperson attributed "operational reasons" for the cancellation of a "number of flights".

The embattled Indian carrier, which has been struggling to raise capital to stay afloat, said it had "proactively undertaken certain adjustments to its flight schedule keeping in mind the likely, yet interim non-availability of some aircraft in its fleet in the near future".

As per a code-sharing agreement between the two carriers, the Jet Airways has been carrying passengers from various Indian cities to its Abu Dhabi hub for their onward journey to international destinations on Etihad flights.

The halting of Abu Dhabi flights by Jet Airways follows the cancellation of some of its flights from Dubai to Delhi and Mumbai on Thursday.

In a statement, the Indian carrier, beset by the grounding of at least 41 aircraft due to payment defaults to leasing companies, said it had kept India's Directorate General of Civil Aviation and its customers informed of the cancellations. "Guest compensation is being handled in line with defined regulatory guidelines. The airline regrets the inconvenience caused to its guests," it said.

The airline said in a stock exchange filing that it would be delaying a bond interest payment due on March 19 "owing to temporary liquidity constraints".

The struggling Indian carrier has been desperately trying to get a critical rescue plan approved by its lenders and Etihad, a key stakeholder since 2013. Specific details of the on-going talks between Etihad and Jet Airways have not been made public.

Referring to reports of impasse in talks between Jet and Etihad airways, Dr Ahmed Al Banna, the UAE Ambassador to India, said: "Etihad owns 24 per cent of Jet Airways, and Jet has its own programme and management and decisions. Yes, they may be facing some difficulties, but it is up to Jet to decide what they want to do."

In February, an extraordinary general meeting of shareholders of Jet Airways, which reportedly has a debt of over Rs80 billion, gave approval to a rescue plan.

Sources familiar with the bail-out efforts said March 18 was the deadline given by Jet Airways founder chairman Naresh Goyal to employees for a specific update of the rescue plan. The carrier has reportedly negotiated approximately $300 million credit facility last week from the Punjab National Bank, a leading member of the carrier's banking consortium, to meet its working capital requirements.

issacjohn@khaleejtimes.com

 

author

Issac John

Editorial Director of Khaleej Times, is a well-connected Indian journalist and an economic and financial commentator. He has been in the UAE's mainstream journalism for 35 years, including 23 years with Khaleej Times. A post-graduate in English and graduate in economics, he has won over two dozen awards. Acclaimed for his authentic and insightful analysis of global and regional businesses and economic trends, he is respected for his astute understanding of the local business scene.





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