Salary, job cuts: Jet Airways says it’s implementing measures to reduce cost; shares down 7 per centhttps://indianexpress.com/article/business/companies/salary-job-cuts-jet-airways-says-its-implementing-measures-to-reduce-cost-shares-down-7-per-cent-5290976/

Salary, job cuts: Jet Airways says it’s implementing measures to reduce cost; shares down 7 per cent

Shares of the airline dived 7 per cent to settle at Rs 308 on the BSE following reports about the airline’s proposal for salary reductions and possible job cuts at various departments. 

The airline company said it has been implementing “several measures to reduce costs as well as realise higher revenues” for desired business efficiencies. (Representational Image)

Full-service carrier Jet Airways, which reported a loss of Rs 1,040 crore in the March-quarter of 2017-18, threatened its pilots to have their salaries reduced, failing which the airline would not last beyond 60 days. However, in a statement on Friday, the Naresh Goyal-promoted airline said it has been implementing “several measures to reduce costs as well as realise higher revenues” for desired business efficiencies. Shares of the airline dived 7 per cent to settle at Rs 308 on the BSE following reports about the airline’s proposal for salary reductions and possible job cuts at various departments.

“The company threatened the pilots that if they did not take a pay cut, company will shut down in two months,” a Jet Airways source told The Indian Express. As part of the aforementioned measures, the company has been in dialogue with all its key stakeholders – internal and external, it said in a statement.

“The dialogue with employees, has been to apprise them of the challenges being faced by the aviation sector in India and by the company in particular, with an intent to enlist their full support and cooperation for realizing necessary savings across all business functions,” the airline said, adding, “some of these areas among others include, sales and distribution, payroll, maintenance and fleet simplification”.

Asserting that it was confident that various transformation initiatives identified and under implementation by the company will help in addressing the current issues faced by the company and the industry, Jet Airways’ CEO Vinay Dube said that “recent media reports about the sustainability of the airline are not only factually incorrect, but also malicious. The airline would also like to deny any conjecture of a stake sale”. The airline has over 16,000 employees.

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“The airline management is in dialogue with key stakeholders to enlist their full support and cooperation for realising necessary savings across all parts of the business. The airline is committed to create a growth-oriented, sustainable future, and a revitalized guest experience armed with the addition of 225 B737 MAX fuel-efficient aircraft which will be inducted in its fleet over the next decade, and of which, 11 are slated to join within this financial year,” Dube said.

He added despite the high growth environment, the aviation industry is currently passing through a tough phase given a depreciating rupee and the mismatch between high fuel prices and low fares. “While continuing with cost saving and revenue enhancement measures to create a growth-oriented sustainable future, Jet Airways will continue to accord highest priority to safety and will ensure that safe operations continue to be resourced as required under regulatory compliances,” Dube said in his statement.

Dube also sent an email to Jet’s customers defending the airline’s commitment to growth and sustainability.