Jet Airways bets on weekend-only flights to beat slot crunch, max revenues

Jet Airways is starting weekend-only flights from metros, a first in India, to overcome slot constraints and maximise revenue growth. The airline has tweaked its schedule by reducing capacity on routes like Mumbai-Delhi and Mumbai-Bengaluru on weekends and utilising the freed up slot at Mumbai to operate flights to Amritsar, Patna and Varanasi. The move is a part of the airline's strategy to efficiently deploy its fleet and increase revenue on the back of intense competition and yield pressure. Yield refers to the average revenue charged per passenger. “For the first time, we are introducing weekday-weekend patterns. We are studying the traffic pattern and have recognised the fact that on heavy business-oriented metro routes, the traffic and unit revenue drops on weekends. On the other hand, there are non-metro routes where people tend to travel on weekends and deploying capacity on those routes offers a better opportunity to increase revenue,” said Raj Sivakumar, the airline's senior vice-president in charge of network and revenue management. Mumbai, which is the main hub for the airline, suffers a slot crunch while other metro airports such as Delhi, Chennai and Bengaluru too have shortage of slots. In all, the airline will be operating weekend only flights on 22 routes from Mumbai, Chennai and other cities. “A combination of weekend flights, unique routes and overall rationalisation of capacity will lead to an increase in unit revenue,” Sivakumar added. In the first nine months of FY 2018, the airline's capacity rose 8.5 per cent while revenue growth was a modest 5 per cent, as airfares remained under pressure.

It posted a revenue of Rs 189.36 billion in the April-December period, while net profit declined 63.5 per cent to Rs 3.15 billion. Sivakumar did not give a target, but expects the revenue to grow faster than capacity in domestic and international markets. He added it was too early to comment on impact on fares and possible changes to Jet's schedules in view of the grounding of Airbus A320Neos flown by IndiGo and GoAir. Jet Airways has 82 Boeing-737 planes, which it operates on domestic and short-haul international routes, and in the next fiscal, it will make a net addition of eight planes. All the new inductions will be fuel-efficient Boeing-737 Max variant and Jet plans to open up new international routes like Mumbai-Nairobi and Bengaluru-Hong Kong in the winter schedule. “Our strategy is to grow in the domestic market. We have identified focus markets like Chandigarh, Indore, Guwahati, Pune, Coimbatore and our plan is to increase connectivity to these cities from other metros and non-metros. The other focus is on developing a mini hub in Guwahati and we will connect it to other cities in North East India and metros," he said. In all, the airline is adding 144 new weekly flights, including industry-first direct flights from Mumbai and Delhi to cities in North East such as Aizawl, Imphal and Jorhat.