Jet Airways, India's biggest carrier, has warned its pilots that the airline may be grounded in 60 days unless they accept a 15 percent pay cut for two years. The company continues to bleed cash, despite several rounds of cost-cutting measures.
As the Airline could not find working capital loans, the only way in front of the company is to implement some cost-cutting measures including pay cuts to its pilots. Pilots have already refused to accept a 15 percent pay cut for two years.
It is learnt that the Company Chairman Naresh Goyal himself had informed the employees in Mumbai and Delhi to cope with another drastic cost-cutting measure that needed to be put in place to save the company.
Jet Airways had approached banks for working capital loans but banks did not offer loans as the airline is in deep loss and the company does not show any turnaround commitment, some sources says. Jet Airways is now looking to implement cost cutting measures at sales and distribution, payroll, maintenance and other areas. Sources also say that the situation may lead to job losses in many departments except pilots. Jet Airways, partly owned by Etihad Airways, has a net debt of Rs. 8150 crore.