Jetwings intl & Domestic

1. INDUSTRY STRUCTURE AND DEVELOPMENT
Jet Airways (India) Limited - 16th Annual Report 2007-08
1.1 The Indian aviation industry continued to grow, though at a slower rate, during the
year under review. Economic growth, the emergence of India as a global economic
power and other factors, that have had a positive impact on air travel in to and
from India, were sustained all through the year under review. However, the aviation
industry worldwide was adversely affected by the spiraling cost of Aviation Turbine
Fuel (ATF), caused by the continuing increase in crude oil prices. The resultant
increases in fares and fuel surcharges that the airlines had to implement, resulted
in a slowdown in air travel, both in India and worldwide.
1.2 Domestic carriers continued to add capacity during the year under review and, as in
the previous year, the growth in capacity was far in excess of the growth in traffic
in the domestic market. This continued overcapacity situation led some airlines to
resort to extremely low pricing, well below break-even levels. As a consequence of
this, combined with high ATF prices, the domestic aviation industry is estimated to
have incurred a loss of close to Rs 40,000 million (USD 1.0 billion) during the year
under review.
1.3 With the liberalization of Air Services Agreements with various countries by the
Government of India, international airlines continued to expand their operations into
India during the year under review. A feature has been the increased frequencies
to other interior destinations such as Bangalore and Hyderabad relieving the
concentration of international flights to and from Mumbai and Delhi. This is
likely to continue with the progressive modernization of other airports and also
the Government’s policy of making interior airports available for direct operations
by foreign airlines, particularly from countries in South East Asia and the Gulf.
However, with the slowdown in air travel that is being witnessed, an overcapacity
situation may emerge on the international routes to and from India.
1.4 The Central Government’s policies with regard to the civil aviation industry
remained positive. The Government of India has signed a number of new
bilateral agreements with major countries, and this has encouraged the growth
of international air traffic to and from India. The Government has also been
proactive with regard to issues concerning the industry especially those relating to
infrastructure.
2. ANALYSIS OF OPERATIONAL PERFORMANCE FISCAL 2008 COMPARED TO
FISCAL 2007
Revenues
Management’s Discussion and Analysis of
Financial Condition and Results of Operations
2.1 Our total revenues increased by 28.1 % from Rs.74,013 million Fiscal 2007
to Rs.94,815 million Fiscal 2008. This increase was primarily due to increase in
Passenger and Cargo Revenues.
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