Priyanshi Pathak

Harshita Mathur
Swagata Dass
Aishwarya Barthwal
 Introduction
• Jet Air was founded by Mr. Naresh Goyal in
1974 to provide sales and marketing services
to foreign carriers in India.
• Started as a Air Taxi Operator in April 1992.
• Started Indian commercial airline operations
on 5 May 1993 with a fleet of four leased
Boeing 737-300 aircraft
• Initial investment of US$10 million
• 80%of its stake controlled by Naresh Goyal
• Jet’s parent company, Tail Winds Ltd.
• Began international operations to Sri Lanka in
March 2004.
• Jet, is headquarters in Mumbai, India 24 April,
2013 Jet sold off 24% if its stakes to Etihad
Airways.
 Competitor Analysis
Domestic Market International Market
 Porter's 5 Forces
Threat from new entrants
LOW

Bargaining power of Bargaining power of

COMPETITIVE RIVALRY supplier
buyer HIGH
HIGH HIGH

Threat from substitutes

HIGH
 BARGAINING POWER OF
BUYER HIGH

 Standard product and services

 Several options are available
 No switching cost
 Incentives available for customer
 Customer loyalty does not come cheaply
 BARGAINING POWER OF
SUPPLIER - HIGH

 Cost of fuel
 Aviation personnel are very few in number
 Airplanes manufactures are very less
THREATS FROM SUBSTITUTES-
HIGH

 Low cost airlines are available

 Mode of transportation availability
 High existing barriers
 BARGAINING POWER OF
BUYER HIGH

 Standard product and services

 Several options are available
 No switching cost
 Incentives available for customer
 Customer loyalty does not come cheaply
 THREATS FROM NEW
ENTRANTS- LOW

 Heavy amount of capital require

 Low profit margin
 Importance of brand image and loyalty.
 COMPETITIVE RIVALRY - HIGH

 Using of Penetration policy by

competitors
 extremely sensitive to economic cycles
 Using of Promotion pricing strategy
 The Crisis
• Financial troubles can be traced back to the
2006 purchase of Air Sahara for $500 million
in cash.
• Single Management Team < Jet's operations.
• The market share declined from 15.4 per cent
last year to 13.9 per cent in November 2017.
• Addition of capacity and its optimal
deployment to increase efficiency, efficacy
and Return on Investment.
• Jet incurred losses of about Rs 76 crore
during FY2018.
• The airline was getting hit due to High Cost
but Lower Yields in India.
• Fall in yields was due to the airline’s
inefficiency of being able to charge a
premium on fares booked at the last minute.
• The airline is in debt of Rs. 8,000 crore.
• All the jets were seized by creditors.
• The carrier had asked for Rs. 400 crore as
emergency fund.
• Did not diagnose the threat.
• Did not launch flights on new routes.
• Increased Crude Oil prices.
• Weak Rupee= Increased fuel prices.
• Lacked a concrete business model.
• Failure to find a Strategic Investor.
• Lack of concrete business model. (Investing
more than earned)
 Undergoing Jet failed to attract The 3rd deadline
insolvency process new bidders during for EOI ended on
extended dead line August31.The
period for earlier two
submission of deadlines were on
initial bids. August3 and 10.

Current
Discussion Russian Fund
Treasury RA
Earlier Etihad was
planning to
Billionaire
businessman Anil
Partners, Panama- reinvest in airlines Agarwal has
based investment but later declined submitted an
firm Avantulo due to unresolved expression of
Group and South issue concerning interest (EOI) to
American liabilities. revive Jet Airways
conglomerate in what could mark
Synergy Group his foray into
Corp had aviation. But later
submitted the opted out of the
EOI’S. race.
HEADLINES
 TOWS
ANALYSIS
STRENGTH (S) WEAKNESSES (W)
INTERNAL *Vertically integrated * Negative margin with
FACTOR/EXTER operation worrying
NAL FACTOR *Strong network portfolio *Limited market share
*Alliance with Etihad * Centralised Power

OPPURTUNITIES(O)
*Growing global tourism industries
*Strategic alliance wide reach
*Positive growth in Indian airlines industries
*New leadership/ management
S-O STRATEGIES
*S-O( 1)- Strong global portfolio- W-O STRATEGIES
Growing global industries.
*W-O(1)- Centralised power-
*S-O(2)- Vertically integrated New leaders/Management
operation-Strategic alliance wide
reach.

THREATS(T) S-T STRATEGIES

W-T STRATEGIES
*S-T(1)- Rather than price cut
*Intensive Competition attract – customer with new *W-T(1)- Negative margin
* Regulation increase innovation were worrying-Economic
compliance act * S-T(2)- Alliance with Etihad- weaknesses
Negotiation with the company and
*Crude oil price many more airlines
 Strengths and Opportunities
Strong Network Portfolio- Growing Global Tourism
United States- Flights to New York already in function:
Washington-DC
New Flight Destinations:
Massachusetts
United Kingdom – Scotland (Edinburgh)

Saudi Arabia- Mecca

Madina
Malaysia- 2 million people (7% of the total population)
Republic of Ireland- 40,000 Indians
Mauritius- 30,000 Indians
Australia - 4,55,389
New Zealand- 1,74,000
 Weakness and Opportunities

Centralized Power- New Leader/Management

 Strengths and Threats
Focus on Innovation through IT and E-Commerce-
Intense Competition

1- Attract Customers with New Innovation-

• Quick Response Barcodes- Access to information using
smart phones.
• Quick Response Barcodes- On E-Tickets.

2- Alliance with more Airlines could curb Economic

Weakness.
 Weakness and Threats
Negative Margins- Economic Weakness

1- Partnership with Other Airlines.

2- Increase in Global Destinations.
THANK YOU