Jet Airways records Rs 2.21 billion for the quarter to March; expects tough times ahead

India’s airline major, Jet Airways, has recorded losses for the March quarter 2008 on skyrocketing jet fuel prices. Jet AIrways said that it expects the next few quarters to be very challenging for the airline as it sees no possibility of ATF prices coming down.

In India, the price of jet fuel has increased 90 percent in the last year and as of now accounts for almost 45% of carriers’ operating income. The airline industry in India is already reeling under pressure due to stiff competition from budget airlines and price pressure.

For the quarter to March, Jet Airways recorded a loss of Rs 2.21 billion as against Rs 880million profit for the previous year. At the same time, the revenue of Jet rose to Rs 27.3billion.

“The next few quarters is expected to be impacted negatively by very high fuel prices as we have seen in the months of April, May and June,” said Jet Airways.

For the year to March 2008, the billionaire Naresh Goyal-controlled airline reported a loss of Rs 2.53 billion on revenue of Rs 94.8 billion.

It is expected that the losses of Indian air carriers would double in 2008/2009 because of the rise in ATF price. Ultimately, its the passenger who has to suffer as the airlines will increase their fuel surcharges because of the fact that domestic jet fuel prices are much more than international prices. The main reason for this can be attributed to local taxes.

Jet also said seat factor decreased from 72.6% to 70.9% as compared to previous year. Seat factor is a measure of how much space in the airline is occupied.

By October, Jet Airways is planning to introduce flights to Dubai and Saudi Arabia.