Jet-Kingfisher alliance yet to gather momentum, says Goyal

Last Updated: Wednesday, September 2, 2009 - 17:59

Mumbai: Jet Airways Chairman Naresh Goyal
said the strategic alliance forged almost a year ago between
his company and Kingfisher Airlines has still not achieved
tangible progress.

"I can`t really tell you when it (strategic alliance)
would be fully operational. We have been discussing, but
nothing much has been done yet," Goyal told reporters on the
sidelines of a function here.

Goyal-owned private air-carrier, Jet Airways, and Vijay
Mallya-promoted Kingfisher Airlines had sealed a strategic
alliance in October last year with a view to curtail costs
after crude prices had shot up astronomically.

Goyal, however, said the two partners have taken certain
steps to synergise their operations.

"We have done certain things. We are co-operating in
engineering and (sharing) some other facilities in order to
improve our bottom lines. We have been looking at how we can
improve our cost structures, especially in engineering," he

Goyal also advocated a 20-25 per cent increase in fares
across the board to bridge the gap between input costs and
revenue. The industry has been faced with a situation in which
the former has been increasing while the latter has been
falling. Jet-Kingfisher is alliance yet to gather momentum, he

"I think today the industry needs around a 20-25 per cent
rise in fares because there is a need to cover costs and also
to break-even," Goyal said.

He said the domestic aviation industry is on an average
losing Rs 800-900 crore due to a 20-25 per cent gap between
revenues and costs, which he attributed to irrational pricing
by air-carriers.

"Every one is doing irrational pricing. Every one is
selling below prices. We don`t want to sell below cost," Goyal

However, when asked if he had any plans to hike fares he
declined to give specifics, saying, "I don`t know."

On the strike-call by Jet Airways pilots union, National
Aviator`s Guild on September 7, Goyal said the government has
already declared the strike as "illegal" and hoped that the
pilots would follow the law.

"It (dispute) is with the conciliation officer, who has
already termed the proposed strike as illegal. We will do
whatever is needed to be done," he said.

Bureau Report

First Published: Wednesday, September 2, 2009 - 17:59

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