..:: India Strategic ::.. Civil Aviation: Jet Airways comes to US as a “Premier-Class Contender”

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Editorial

Jet Airways comes to US as a “Premier-Class Contender”

By Arun Kumar

Published : September 2007

Washington. With Jet Airways introducing its first service in the United States this week, the New York Times has featured it in a special report saying the Indian airline makes its case as a
“premier-class contender”.

“Better than Singapore, better than Cathay and at least as good as Emirates.”

“That was how Naresh Goyal stated his goal that the Indian carrier Jet Airways be rated among the top premier-class service in the world in a few years,” said Joe Sharkey in his “On The Road” column Tuesday.

“Goyal does present an interesting case,” he said noting “most Americans have never heard of Jet Airways, the airline he founded in India 14 years ago as a domestic carrier and began building into an international player. That will change.”

Jet Airways will operate a daily flight between Newark (New Jersey) and Mumbai with a stopover at the airline’s new hub in Brussels with one of 10 new Boeing 777-300ER aircraft it ordered as part of a $3.7 billion international fleet expansion. The expansion will add 20 777s and Airbus A330s to the fleet. The airline also has orders for 10 new Boeing 787s.

In the United States, much of the attention in the premium markets has been on trans-Atlantic service, as airlines like United and American spruce up business-class cabins to try to compete with top-tier carriers like British Airways and Virgin Atlantic, as Jet Airways comes to US as a “Premier-Class Contender” well as the start-up all business-class airlines like Eos, the Times said.

Foreign airlines like Singapore Airlines and Cathay Pacific Airways, meanwhile, have set the standards for premium-class travel between the United States and Asia, and have a major chunk of the international premium-class market in India.

Jet Airways made its mark in India’s fiercely competitive domestic market, where most airlines “are doing irrational pricing” and losing money, Goyal was quoted as saying by the Times.

Jet Airways, which is profitable, now flies between 40 cities in India and has expanded to routes between India and London, Sri Lanka, Nepal and Southeast Asia. The airline plans to add service late this year to San Francisco and later to Toronto, Johannesburg and the Persian Gulf - all big premium-class markets.

India’s main carrier, the government-owned Air India, has been reacting to the competitive threat to its long-haul markets. It has expanded its international routes and its fleet with 22 long-haul wide-body aircraft, including 777-200ERs and 747-400s in the last three years, and has ordered 27 Boeing 787s among other new long-haul planes.

Air India, which recently upgraded its first-class cabins on long-haul flights, now has 29 flights a week between India and Newark, Kennedy International Airport, Los Angeles and Chicago, the Times noted.

The lure of the Indian market recently prompted Continental Airlines to move up the starting date for its new non-stop service between Newark and Mumbai to Oct 1 from Oct 28. Continental has flown between New York and Delhi since 2005.

Continental promotes its Business First-class service on long-haul routes. But top-tier premium airlines offer more luxurious amenities, including cubicle-like personal spaces and lie-flat beds in business class. Emirates even has first-class cabins with seats enclosed in private compartments with doors.

Goyal told the Times that Jet Airways’ new long-haul first-class service will top that, with sliding double doors, an 83-inch lie-flat bed, storage closets, a 23-inch flat-screen video monitor, and a work table that can also seat two for an intimate dinner.

The money is there, he insists. “In India, there are about 30 million people who would be called ‘rich rich’ and another 350 million middle class,” Goyal said. “The economy is growing. Many Indians have the money, and they want quality service when they fly internationally - standards not lower than Singapore and Cathay.”

He said there are 39 million Indian nationals living overseas, many employed in high-paying jobs in banking, technology and medicine. That doesn’t include the growing number of affluent Americans and other foreign business travellers who are now flying regularly between the United States and many cities in India.

Fare discounting for premiumclass service has begun to break out among some airlines, chiefly United States carriers, on the lucrative trans-Atlantic market, where walkup business-class fares are typically $8,000 to $9,000. (Walk-up first-class fares between New York and London on British Airways are over $12,000.)

But Goyal, according to the New York Times, insists that Jet Airways will be able to prosper without heavy discounting. “We will be charging fares like British Air, Lufthansa, Emirates, Singapore,” he said. “We will not go into that fare war craziness.”