India’s Jet Airways approaches McKinsey for turnaround plan
India's second largest airline has appointed McKinsey to advise on cost-cutting measures and Boston Consulting Group for revenue enhancement
Troubled airline Jet Airways has hired consultants to chart a roadmap for a turnaround. India’s second-largest airline with a market share of just under 16% has appointed McKinsey to advise it cost-cutting moves and Boston Consulting Group to help it with revenue enhancement, the Economic Times reports.
The airline, led by Naresh Goyal, is grappling with operational and financial issues, while a weak rupee and rising fuel prices are adding to its misery. Jet Airways has a debt of around 60 billion rupees (US$815 million) and the airline is losing 100 million rupees a day.
The airline delayed salaries of its employees, grounded at least eight planes in its fleet, and let go of some senior managers but is being watched by lenders for possible defaults.
In August, senior managers took pay cuts of 25%. The airline asked pilots and technicians to take similar cuts, but they refused.
Recently salt-to-software conglomerate Tata Group voiced interest in taking over Jet Airways, but it wants full control of the airline, with Naresh Goyal divesting his stake.
Goyal also reportedly approached India’s richest man Mukesh Ambani, who heads Reliance Group, to raise funds for the airline, but the latter is yet to respond, LiveMint has reported.
Jet Airways has 124 aircraft, flies to and from 66 destinations and has nearly 700 flights a day.