JET

AIRWAYS
 Airline Industry in India
 454 airports and airstrips
 (includes Operational, Non Operational, Abandoned
and Disused Airports)
 127 are owned & operated by AAI
 16 - international, 7 custom airports, 28 civil enclaves
 Scheduled domestic air services - available from 82 airports


 May 2007- May 2008

 25.5 million domestic & 22.4 million international passengers
 20% growth – highest in the world


 Growth Rate Projections (for next 5 yrs)

 15% p.a (Passenger Traffic)
 11.4% p.a (Cargo Traffic)

 History
 1911  First commercial flight
  Airmails from Allahabad to Naini(10 km)
 1932  The Aviation Department of Tata Sons Ltd. Established
 1938  Tata Airlines (successor to aviation division of Tata
 Sons)
 1946  Tata Air Lines converted into a public Company and

renamed Air India Limited
 1948
 Air India International incorporated



 1953
 Nationalization of Aircraft Industry
 Air India (serving the international sectors)
 Indian Airlines (serving domestic sectors)
 Deccan Airways, Airways India, Bharat
Airways, Himalayan Aviation, Kalinga
Airlines, Indian National Airways and Air
Services of India



 History
 1986  Private Sector Players permitted as Air
  taxi operators
  Players including Jet, Air Sahara, NEPC, East West,
 Modiluft,etcstarted service
 1990  Open Sky Policy
 1994  Private Carriers permitted to operate scheduled services
 2003  Entry of low-cost carriers
 2007  Merger of Indian Airlines into Air India
  Acquisition of Air Sahara by Jet Airways
 2008  Kingfisher acquired 49% stake in Deccan Aviation
 Regulatory Authorities
 Ministry of Civil Aviation
 Responsible for the formulation of policy, development and regulation of
Civil Aviation. Its functions also extend to overseeing airport
facilities, air traffic services and carriage of passengers and goods by
air


Other Attached/Autonomous Organizations:



 Directorate General of Civil Aviation (DGCA)

 Promote safe and efficient Air Transportation through regulation and
proactive safety oversight system
 Bureau of Civil Aviation Security (BCAS)
 Regulatory authority for civil aviation security in India


 Airport Authority of India (AAI)

 Accelerate the integrated development, expansion and modernization of
the operational, terminal and cargo facilities at the airports



 Policies
 Open Sky Policy
 FDI
 Airports
 100% for green field operations
 74% for existing airports - 100% with special permissions
 100% tax exemptions for 10 yrs.


 Airlines
 49% in domestic airlines - 100% for NRI’s
 74% in cargo & non-scheduled airlines




 Market Share in Domestic
Market

In Post Consolidation Jet includes Air Sahara & Kingfisher includes Air Deccan
§Market Share is based on their Capacity Source: B&K Securities
 Service vs .
Price
High
Jet Airways

Kingfisher Indian Airlines

Full
Service
Air Deccan

SpiceJet

Go Air Indigo

Low
Low High
Price

Source : http://www.foolonahill.com/mbaaviation.html
Cost Structure

Source : http://www.foolonahill.com/mbaaviation.html
 Jet Airways
 Founded in 1993, Chairman - Mr.Naresh Goyal


 HQ in Mumbai
 Country’s second largest international airline
 Largest domestic airline - 31%


 Primary base - Mumbai's Chaatrapathi ShivajiAirport

Secondary hubs - Bangalore, Brussels, Chennai, Delhi,
Hyderabad, Kolkata and Pune.


 April,2007 - Acquired Air Sahara - JetLite



 Now JetLite integrated into Jet Airways


International Network
Domestic Network
Fleet Plan
 Jet Airways - Performance
 Annual Revenues - Rs.9481.5 crores (2007-08)
 Rs.7401 crores (2006-07)


 Profit(Loss) After Tax - Rs.253 crores loss (2007-08)

 Rs.27 crores profit (2006-07)
 - All Other Domestic Players showed
loss(2006-07)

 Operational Highlights
Operational Parameters 2007-08 2006-07

Number of departure 126,676 119,369

Available Seat Kilometers (ASKMs) 24,447 17,698

Million
Revenue Passenger Kilometers (RPKMs) 16,914 12,307
Million
Passenger Load Factor % 69.2% 69.5%

Revenue Passengers (Numbers) 11,428,910 10,726,874

Average Fleet Size 66.3 56.1

Revenues & Expenditure Split -
up
Jet Airways vs . Domestic Players ( 2006 )
Jet Airways vs . International Players
( 2006 )
 STP
 Primary Segments (Geographic) - Domestic & International

 Customer Segments
 First class, Premiere(Business) class & Economy class

 Target Segments
 Premiere(Business) class
 Business travelers, contribute 48% of passengers & 66% of revenues,
 ready to pay higher prices, last time booking, don’t like transit
 Economy class
 Leisure travelers, prefer low cost airlines, ready for transit if there is cost
advantage, large % of passengers


 Seat Allocation – Yield Management Technique

 Positioning – High value for High price

Unique Selling Price – Customer relationship and Punctuality

Seating in flights for
Segments
 Fleet Size
Air craft No. Seats per flight

First Premiere Economy

Airbus 330-200 11 - 30 190

ATR 72-500 11 - - 62

Boeing 737-400 04 - 24 112

Boeing 737-700 13 - 16 96

Boeing 737-800 33 - 24 120

Boeing 737-900 02 - 28 132

Boeing 777-300ER 10 08 30 274

Total 84
Flower of Services
  Information - Reg. the org., flight schedules, ticket fares, promotion
schemes etc.
 Through website, call service, sms, employees
etc.


 Consultation - Reg. the choices of class, routes to a destination & special

menus for frequent fliers


 Order taking - Booking - through phones, fax and internet

 - Ticket Office, Call Centres, Company Website & Agents


 Hospitality - Most important differentiating factor (from ticket booking

to post flight help)
 Safe keeping - Luggage & Children


 Exceptions - Special requests reg. meal preferences, special amenities

for elderly people or children, medical needs etc.


 Billing - Charges split, E-mail bills etc.



 Payment - Credit card, Travellers cheque, Special payment privileges

for frequent fliers
Impact of IT on Ticket Booking
Levels of Product
 Product - Service
 On Ground Services
 Check in options - Airport check-in, Tele Check-in, Web Check-in,
 Kiosk Check-in, SMS Check-in, Check-in while walk-
in,
 One Time Check-in on Return Journey, Through
Check-in
 Airport Lounges
 Coach Services


 In-flight Services
 Classes of Service - First class, Premiere class & Economy class
 Convenience & Safety -Towels, Pillows & Blankets, Reading material,
 First Aid, Smoke detectors, Bassinets, Child Care, life jackets & seat
cushion
 Cuisines
 Entertainment - Jetscreen– Movies, TV programmes, Games, Music, In-
flight communicator, Online
magazines etc.
 Product - Service
 Special Services
o Infant and child care, wheel chair assistance, expectant mothers,
unaccompanied minors, medical emergencies, travelling with animals
& carriage of stretchers

 JetMobile
 JetKids
 JetEscapes
 Cargo



 JetPrivilege – Frequent Flyer
Program
 Membership tiers – Blue, Blue Plus, Silver, Gold & Platinum
 Personalized web access
 JP Miles - 13 quarters validity
 Bonus JPMiles on e-Services
 Additional baggage allowance
 Guaranteed reservations up to 24 hrs. prior to departure
 Waiver on cancellation fees
 Membership Tier Bonus


 Earning & Redeeming JP Miles

 Eg: Chennai to Thiruvananthapuram (Earn Mile-383 & Redeem Mile-6894)
 Airline Partners - Air France, American Airlines, ANA, Austrian
Airlines, Brussels Airlines, Cathay Pacific, Dragonair, Etihad
Airways, Gulf Air, JetLite, KLM, Lufthansa, Northwest Airlines ,
Qantas, South African Airways, SWISS, United Airlines and Virgin
Atlantic.

 Price
 Economy & Club Premiere Fare
 Discounted fare for senior citizens & defense
personnel
 Advance Passenger Excursion/ APEX Fares
 One Fare
 Night Saver Fares
 Check Fares
 US Dollar Fares & Visit India Fares

 Place
 Place of Service - Aircraft


 Various Destinations
 Promotion
 Offers
 Companion Free Offer, One Fare, Concessional fares, JetPrivilege Offers,
 Jet Airways Citibank Credit Cards, Corporate Deal Offers, International
Specials, Camp Rock contest, Festival specials, Student specials, Surprises
etc.


 Advertising and Branding


 Hoardings
 Brand Ambassadors
 Sponsorships
 Event Organization
 People
 Employees
 Pilot, Cabin Attendants, Engineers, Customer Service Agents, Securities,
Marketing, Sales & Reservation employees


 Customers



 Partners
 Airline Partners - Air France, American Airlines, ANA, Austrian Airlines,
Brussels Airlines, Cathay Pacific, Dragonair, Etihad Airways, Gulf Air,
JetLite, KLM, Lufthansa, Northwest Airlines , Qantas, South African
Airways, SWISS, United Airlines and Virgin Atlantic.
 Code Share Partners - Air Canada, All Nippon Airways, American Airways,
Brussels Airlines, Etihad Airways and Qantas
 Co-Brand Cards - CitiBank
 Conversion Partners - BarclayCard, CitiBank, Deutsche Bank AG, HDFC
Bank, HSBC, ICICI Bank, SBI Card & Tata Cards
 Car Rental Partners - Avis, Hertz
 Hotel Partners - Global Hotel Alliance, Hilton Family Hotels, Hyatt Hotels &
Resorts, InterContinental Hotel Groups, ITC etc.
 Lifestyle Partners - Globus and Golf Fee Card International
 Publishing Partners - Fortune, The Economist and TIME
 Retail Partners - Ferns n Petals
 Telecommunication - Matrix Cellular Services
 Competitors


 International market - British Airways & South West Airlines



 Domestic market - King fisher, Indian Airlines, GoAir,

Spicejet & Indigo

 Process
 People Processing

 People physically enter the service system to receive the service. Aircraft
is the service factory where service is delivered.


 Possession Processing

 Cargo
 Luggage & Courier
 Physical Evidence
 Servicescape
 Servicescape usage - Interpersonal
 Complexity of Servicescape - Elaborate


 Flight
 Offices - Org. & Ticket Booking Agents
 Virtual Servicescape

Service Quality

Source : http://www.foolonahill.com/mbaaviation.html
Service Quality

Source : http://www.foolonahill.com/mbaaviation.html
Strategies to manage the Capacity &
Demand
 Check Fares
 Automated Rostering System
 Planning and Scheduling Systems
 Code Sharing
 Outsourcing ramp handling, passenger handling, ticket
checking, cargo and loading and unloading in Delhi and
Mumbai
 Automation to drive efficiency and improve response time
 Faster page and application download times for its site
 Corporate Social
Resposibility
 Magic Box
 Fund raising inside the flight for disaster relief,
education & healthcare for poor and programmes to
prevent exploitation of women


 Flights of Fantasy
 Underprivileged children and children with special needs
are taken on specially organized flights (on Children’s
Day)
 PEST Analysis
 Political Issue  Social Effects
 License issue for  Sound Pollution
international operation  Plane hijacking
 Infrastructural constraint
 9/11 Incident
 ATF price policy



 Economic Effects  Technology Effects

 Rising income level  Modernization of aircrafts
 Reduced fare but yet not  Modern technology like
enough CAT3 and ILS

 
 SWOT Analysis
 Strengths
 Market driver  Opportunities
 Experience exceeding 14  Untapped air cargo market
year  Scope in international
 Only private airline with service and tourism
international operation 

 Market leader 
 Largest fleet size 

 Threats
 Weaknesses  Strong competitors
 Loosing domestic market  Fuel price hike
share
 Overseas market
 Old fleet with average age
competition
around 4.79 years
 Scope for improvement in 
 in-flight service
 Weak brand promotion



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