Agency Mumbai: After flying for 25 years, Jet Airways on Wednesday announced temporary grounding of operations after the lenders declined a Rs 400-crore lifeline, putting at stake 20,000 jobs and thousands of crores in passenger refunds, dues to vendors and over Rs 8,500 crore to banks. Founded by Naresh Goyal, who began as a general sales agent to a host of international airlines with travel agency Jetair, the full-service carrier served tens of millions of passengers for over two-and-half decades, before becoming the seventh domestic carrier to shutter operations in the past five years. However, the once-premiers airline flew into deeper turbulence-second in its history after the 2010 crisis– after four back-to-back quarterly losses, leaving it gasping for financial breath and forcing it to default on payments to nearly all–from banks to lessors, to employees, and eventually leading to the shutdown from tonight, as its fleet strength has crimped to just about five planes from 123 in December last. “Since no emergency funding from the lenders or any other source is forthcoming, we will not be able to pay for fuel or other critical services to keep the operations going. “Consequently, with immediate effect, we are compelled to cancel all our international and domestic flights temporarily. The last flight will operate today,” Jet Airways said in an evening statement. The troubles at Jet sent airfares soaring and its pains were the gains for rival carriers like Indigo and Spicejet which took over most its slots at premium airports. The formal grounding announcement will lead to exponential spike in airfares amid the peak summer travel demand. Under a debt resolution plan approved by the airlines board on March 25, Goyal agreed to cede control to the lenders consortium and also resigned from the chairmanship. His wife, Anita, too quit the Board. He had also agreed to halve his stake in the airlines to around 25 per cent. But the April 2 Supreme Courts order quashing the February 12, 2018 RBI circular (which ended all debt recast plans even on one-day default) put paid to the resolution plan as banks were left with no leeway to restructure the loan and pay the promised Rs 1,500 crore interim funds, which would have been converted into equity at Re 1 a share and also take over the management control. Before its last flight tonight from Amritsar to Delhi, Jet’s fleet has diminished to just five aircrafts and 37 flights from 123 planes and some 650 flights daily till December last. “This (temporary grounding) decision has been taken after a painstaking evaluation of all alternatives that were made available to the airlines and after receiving guidance and advice on the same from the board,” the airlines said, adding it has informed the civil aviation and finance ministries besides the regulator DGCA, of its decision.
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