Jet Airways and Kingfisher Airlines announced an agreement to form an alliance aimed at helping both carriers to rationalise and reduce costs. There will not, however, be any mutual equity investments between the two companies.
The scope of the alliance, according to the two private carriers will include the following areas: Code-shares on both domestic and international flights subject to regulatory approval; interline/special prorate agreements to leverage the joint network deploying 189 aircraft offering 927 domestic and 82 International flights daily; joint fuel management to reduce fuel expenses; common ground handling; cross selling of flight inventories using the common Global Distribution system platform; joint network rationalisation and synergies; cross utilisation of crew on similar aircraft types and commonality of training and also technical resources, subject to regulatory approval; and reciprocity in Jet Privilege and King Club frequent flier programmes.
“All over the world, airlines have formed alliances in order to become more efficient, improve revenues and provide seamless travel opportunities for their customers,” Naresh Goyal, chairman of Jet Airways said in reference to this ground breaking move.
“India has witnessed tremendous growth in the past which has slowed down considerably. In this environment the Jet Airways – Kingfisher alliance represents a completely new industrial model for aviation in India which would be based on an unprecedented depth of cooperation between the two companies. There will be huge cost savings and revenue enhancement opportunities arising from this alliance.”
Similarly Dr. Vijay Mallya, chairman, Kingfisher Airlines said: “This is a quantum leap forward in the evolution of Indian aviation which will benefit customers by delivering the most comprehensive integration in the industry. Both Jet and Kingfisher fully realise that better understanding of supply and demand in this capital and labour intensive industry is the key to profitability and enhancement of shareholder value.
“I look forward to this alliance delivering superior quality, cost savings, flexibility and enhanced consumer value which is the hallmark of all successful alliances.
