Cash-strapped Jet Airways is scouting for expatriate pilots to operate its new generation Boeing aircraft and regional jets.
Cash-strapped Jet Airways is scouting for expatriate pilots to operate its new generation Boeing aircraft and regional jets. The Naresh Goel-promoted airline was till last week negotiating a 15% salary cut with its Indian pilots and other employees citing a stressed balance sheet. Typically, expatriate pilots are around 30-40% more expensive than local pilots. Jet is understood to have reached out to aviation hiring firm Contractair and V1 Global in late July. This was around the time that the management was trying to convince employees to agree to a salary cut.
The airline is understood to be looking to hire captains on a permanent basis. Jet will provide for accommodation for all the shortlisted pilots. All contracts are for at least three years and pilots will earn a tax- free salary. In response to an FE query, a Jet spokesperson said, “Since we are in a quiet period, we are unable to offer any comment.”The airline has not posted a profit for the past 11 years (but for FY16-FY17). It has 120 aircraft in its fleet and just a 15% market share is struggling with cash flows.While the management has attempted to prune costs, it has met with little success.
Jet’s salary bill for FY18 was Rs 3,174.22 crore; a major part of an airline’s cost is manpower resources. Over the past five years, Jet’s employee costs grew at a CAGR of 13.7% but revenues grew at just 4.8%. Jet has about 6,000 employees, 2,000 of them being pilots.
The Indian civil aviation regulator had not looked upon favourably on hiring expatriates and had mandated earlier that the airlines phase out expats, a move Indian airlines have not been able to follow through due to acute shortage of commanders and lack of trained resources available for flying the newer generation aircraft like the ones Jet has on order — the Boeing 737NG or the Boeing 737Max that it recently inducted to its fleet. Indian airlines have been short of commanders to fly the ATRs and have been forced to hire expats for this particular type.