India’s Jet Airways on Wednesday suspended all flights after it failed to reach a deal with lenders while its UAE-based minority stakeholder Etihad Airways confirmed that it continues to re-accommodate and support affected guests.
“With immediate effect, we are compelled to cancel all our international and domestic flights,” the debt-stricken carrier said on Wednesday evening.
Abu Dhabi-based Etihad said that their teams are assisting guests with their travel arrangements and rebooking those affected onto the next available flights.
“We continue to work with Jet management, lenders and key stakeholders in the context of the lender-managed effort to restructure the company,” it said.
The debt-stricken carrier decided to suspend flights after its chief executive Vinay Dube made a final appeal to lenders to release Rs4 billion in emergency funding. But the consortium, led by State Bank of India, refused to entertain its request for interim funding. The cash-strapped airline owes more than Rs80 billion to the consortium.
“Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel or other critical services to keep the operations going. Consequently, with immediate effect, Jet Airways is compelled to cancel all its international and domestic flights. The last flight will operate today (Wednesday evening),” Jet said in a statement.
Jet’s last flight was scheduled to fly from Amritsar airport to New Delhi at 10.30pm (India time) on Wednesday night. It was operating 119 planes on December 31 when it first defaulted. On Wednesday, it was flying only five aircraft with over 25 flights.
Jet Airways failed to combat low-cost airlines to entice passengers on long-haul services, despite being aligned with Etihad which offers premium products.