close

News WrapGet Handpicked Stories from our editors directly to your mailbox

Jet Airways crisis seeps into allied business

File photo. Photograph:( Reuters )

WION Web Team New Delhi, Delhi, India Apr 19, 2019, 02.19 PM (IST)

The employees and the passengers are not the only ones feeling the domino effect of the Jet Airways crisis, businesses across the spectrum are also feeling the heat as the operations of the 25-year-old airline came to a grinding halt recently.

The grounding of Jet Airways flights has greatly affected the export of fresh produce to Europe.

Jet Airways had the highest capacity for Cargo. The airline had accounted for 50 per cent of exports from Mumbai to places like London, Amsterdam, Paris and Singapore.

Dubai based Emirates which has the second highest cargo capacity has in result hiked freight rates by 30 per cent to 40 per cent.

The freight rates on an average used to vary between 75 to 80 rupees per kg. But now they have risen to an excess of 100 rupees per kg.

The business community is cautious of the fact that if the status quo continues. This might have a long term impact on export volumes and price commitments.

The trouble at Jet Airways is also impacting the earnings of the hospitality industry.

The troubled airline owes a great deal of money to leading hotel chains and in-flight caterers.

Sources say that the suspended airline owes money to hotels like Marriott, taj, Hilton and Hyatt for crew accommodation that was booked in advance.

Air carriers don't often pay in advance. Billing cycle and room nights vary for each carrier. And bills are often sent to the companies later for payment.

 

Story highlights

The freight rates on an average used to vary between 75 to 80 rupees per kg. But now they have risen to an excess of 100 rupees per kg.