The Indian airline industry received yet another blow September 8, when about 360 Jet Airways pilots went on an illegal strike in Mumbai to protest the dismissal of two union employees in August.
The 163 captains and 198 first officers, which represent 40% of Jet's pilots, simultaneously reported sick at 10pm Tuesday. This resulted in 186 flights - 154 domestic and 32 international services - being cancelled or disrupted. The majority of the 13,000 travelling passengers were transferred to other carriers, while foreign pilots have been recalled from leave and put on standby. to man long haul flights.
While Jet has managed to handle the situation by tapping on allied resources, the jury is still out on how the latest debacle will impact the airline.
A review of the past 12 months is hardly heartening. In October 2008, Jet Airways announced it was laying off 1,900 employees because of the economic slowdown and soaring costs, and early 2009, it reported a quarterly loss of $43.656 million (Rupees 214 crore) in the quarter ended December 31, 2008.
And in April 2009, Jet was taken to court in April for refusing to pay tax liabilities incurred by Sahara Airlines before Jet took over it in April 2007. Jet Airways bought Sahara Airlines from Sahara India Commercial Corp Ltd for $284 million (Rupees 14.5 billion) and renamed it JetLite.
Jet paid SICCL a lump sum with the remainder of the payment divided into four yearly instalments of 1.375 billion, which started in 2008. However, Jet Lite had to pay tax dues based on activities prior to the merger, which it is claiming back by deducting the sum from its installments to SICCL. With all this overhang, the pilots' strike does not bode well for the airline's health.
Already, Jet's pilots have chosen to strike in an industry with failing lungs -- the Center for Asia Pacific Aviation reported in April that estimated total losses for 2008 for airlines operating from in and around India lost about $2 billion. And with travel demand falling further with the health scares from the H1N1 virus and the struggling global economy, the overall picture is far from rosy.
The irony is that the strike over two people may end up costing many more their jobs in an already fragile industry should the airline buckle under this latest showdown.
On the part of the pilots, I'd say the move to strike may turn out to be a case of missing the forest for the trees.
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