Jet may temporarily suspend ops tonight as banks refuse funds

NEW DELHI: When Jet Airways‘ flight 9W-2502 lands in Delhi from Mumbai at 10.30 pm on Wednesday, the airline will go gently into the night. It may wake up at a later date if revived by a new owner and fund infusion after a temporary shutdown from Wednesday night. But when, and if that, resurrection happens, remains to be seen.

The airline would have turned 26 in just over a fortnight and will remain the longest living private Indian carrier unless someone else overtakes that record — an uphill task in India’s exceptionally cost hostile environment for ‘desi’ airlines.

“We made a last ditch effort to get at least Rs 400 crore from lenders on Tuesday morning to remain afloat. That has not happened and now we have no option but to temporarily shut down. A formal announcement to that effect will be made shortly if the funding situation does not change,” said a senior Jet official.

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Airfares on rival carriers have soared and Air France and KLM are operating additional flights to Mumbai to accommodate passengers affected by Jet’s decision to cancel international flights.

Jet’s “last” flight is symbolic for at least two reasons. It will take off from Mumbai on a Boeing 737, the same place from where the first flight had taken off on May 5, 1993, for Ahmedabad using a B737. The aircraft used is a JetLite plane, the name given to Sahara Airline when Jet bought it over a decade back. The airline never did recover from the financial impact of this expensive transaction. The airline has now crumbled under the weight of payables of over Rs 20,000 crore.

Jet’s board had met in Mumbai Tuesday morning and empowered CEO Vinay Dube to take a final call on shutting operations after making a final effort with lenders to release emergency funds. Accordingly, Dube wrote to lenders after the meeting to seek at least Rs 400 crore as interim funding.

“The management said there is no money to continue operations. It was told to make one last and final effort for getting emergency funding from lenders. If no funds come, Dube has been authorized to decide to shut down operations anytime now,” said a person in the know.

That eventuality may finally have been reached.

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