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India: Jet Airways’ demise leads to spike in airfares, massive hotel cancellations

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The abrupt shutdown of Jet Airways operations has left Indian tourism industry a worried lot as it has led to an average 25 percent spike in airfares across the sectors leading to massive hotel cancellations, says industry experts.


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Some key sectors like Mumbai-Hyderabad, Mumbai-Delhi and Delhi-Mumbai have seen the fares flying by 62 percent, 52 percent and 49 percent, while the Bengaluru-Delhi sector has had the lowest impact with a 10 percent surge shortly before and soon after the grounding of Jet.

Financially struggling for months, Jet Airways decided to call it quits from Wednesday night, leaving 22,000 jobs at stake and inconveniencing lakhs of passengers both domestic as well as international as Jet was the single largest airline out of and into the country.

“The impact of grounding of Jet Airways is not only restricted to the airlines sector as tourism has taken a severe beating due to the massive surge in airfares during the peak demand season. The impact is unlikely to fade away anytime soon and may continue into the rest of the year,” Travel Agents Association of India (TAAI) president Sunil Kumar said Friday.

He said, both the domestic as well as international travel and related sectors are affected as travelers are cancelling their hotel bookings as airfares have surged by over 25 percent on average.

Leading tour operator Cox & Kings’ Karan Anand said the shuttering of Jet has upset the travel plans of many who have booked on Jet.

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“This is the peak travel season and the airfares for the next 10-12 days are up by at least 25 percent as the capacity has fallen massively dissuading last minute travelers,” he added.

However, online travel aggregator Easemyyrip.com co- founder Nishant Pitti tried to downplay the impact saying airfares normally fluctuate as the aviation industry is always unpredictable.

“It is true that passengers are in panic now but going forward there will not be much impact as other airlines like Spicejet and Indigo are adding more planes into their fleet which will help balance demand-supply gap,” he said.

Train booking and discovery platform Confirmtkt cofounder Sripad Vaidya said due to the flight charges going up, there is a huge surge in people opting for trains and buses.

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Qatar Airways: Investment in Air Italy fully compliant with US-Qatar Open Skies Agreement

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Following recent false accusations relating to Qatar Airways’ shareholding in Air Italy, such baseless statements and consistent inaccuracies need addressing as a matter of urgency.

Qatar Airways holds a 49 percent stake in Air Italy’s parent company, AQA. This minority investment is at the same level that Delta holds in both Virgin Atlantic and Aeromexico, and that Etihad held in Alitalia.

Qatar Airways’ investment in Air Italy, and operations to the United States, are fully compliant with the U.S.-Qatar Open Skies Agreement, the January 2018 U.S.-Qatar Understandings, and a side letter that accompanied the discussions.

Unfounded claims that Qatar Airways’ investment in Air Italy violates the Understandings are entirely false.

As a factual matter, the investment preceded the January 2018 U.S.-Qatar Understandings.

· The investment was announced in a July 2016 press release and was approved in writing by the European Commission (DG Competition) in March 2017.

· The transaction was closed in September 2017.

· The discussions surrounding the Understandings took place in December 2017 and January 2018.

Qatar Airways’ investment in Air Italy was a matter of public knowledge (as were Qatar Airways’ investments in other airlines) at the time of the U.S.-Qatar discussions; airline investments were not raised as a point of concern during those talks. The Understandings do not mention or prohibit cross-border investments of any type.

Furthermore, Qatar Airways does not codeshare on any of Air Italy’s flights to the United States, and has no plans to do so. Qatar Airways is not operating any Fifth Freedom scheduled air services to the U.S.

The “Big 3” U.S. carriers have consistently demonstrated their hostility to new entrants into the U.S.-Europe market, and their attacks on Air Italy based on the identity of its minority shareholder are just another manifestation of this hostility. Air Italy, the carrier the “Big 3” cite as a major “threat” to their survival, has a fleet of just 15 aircraft and only serves one U.S. city – New York – with a daily service while other routes, Miami, Los Angeles and San Francisco are operated at a lower frequency.

The U.S.-Qatar Open Skies Agreement has brought enormous benefits to U.S. and Qatari consumers, businesses and communities. Qatar Airways’ services to the United States contribute to U.S. tourism and business. Qatar Airways is a long-term and loyal customer of Boeing, Gulfstream and General Electric, helping to secure tens of thousands of U.S. jobs through our continued investment in their products and is a valued partner to many other U.S. businesses.

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South East Asia Hotel Investors’ Summit returns to Westin Grande Sukhumvit, Bangkok

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The South East Asia Hotel Investors’ Summit returns for its third edition in May and will again feature top executives from both hotel owning groups and management companies and a range of cutting-edge topics.

SEAHIS focuses heavily on the issues facing hotel property investors. What topics are top-of-mind at the moment? Simon Allison, Chairman of hotel owners’ alliance HOFTEL which organizes the Summit notes:

The market in South-East Asia is generally booming, but investors in hospitality properties still face numerous challenges. These include:

• The need to pay numerous fees and taxes, to the online travel agents, to the brands and to the governments which between them can take almost half of what a guest pays the hotel

• The challenge of the sharing economy and of new forms of accommodation

• Oversupply as new properties get built

• The one-sided contracts which some hotel brands impose on them

• The dangers of relying too heavily on a single inbound market, like China – as the fall-off in demand in Phuket after the boat disaster showed last year

• Acquisitions of boutique brands by the majors – can these make money for their buyers and for the owners of the properties they manage

The last point is very much a relevant topic at the moment given the vast sums recently paid by Intercontinental for a stake in Six Senses, by Hyatt for Two Roads and by GIC for a stake in CitizenM.

These issues will be addressed at SEAHIS by many of the region’s most senior hotel and travel executives including Suchad Chiaranussati, CEO of SC Capital; Dillip Rajakarier, CEO of Minor International; Thomas Willms, CEO of Deutsche Hospitality; Brian Williams, Deputy Chairman of Swire Hotels; Aron Harilela, CEO of Harilela Hotels; Stephan Vanden Auweele, Chief Hospitality Officer of Asset World Corporation (TCC); Piyaporn Phanachet, CEO of U City; Andrew Langdon, SVP Development Asia, Accor; Mike Orgill, Director, Public Policy, Airbnb and Jake Stein, Senior Director, Owner Relations at Expedia.

“Last year almost 50% of all attendees were from groups which own or develop hospitality real estate, said Simon Allison, CEO of HOFTEL. “They want exciting and sometimes controversial content and we aim to deliver that. Our speakers are senior and so are most of the audience, so it’s a highly informed debate.”

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Jet Airways leader gives in to pressure to quit

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In a major, although not unexpected development, Jet Airways founder and chairman, Naresh Goyal, and his wife, Anita, have resigned from the board.

The pioneer aviation leader, who founded the full-service airline 25 years ago, has been under pressure to quit. Etihad has a 24 percent stake in the airline, and its one director is also quitting, this writer learned.

The airline has to ground scores of its planes for non-payment of lease money. Goyal has written a letter to 22,000 Jet staff members saying that this is a new chapter, and not the end of the road.

The future course of Jet Airways will be decided by the lenders, led by State Bank of India, and an amount of Rs 1500 crores may be invested now to solve issues for the moment. The government is also expected to play an important role, as it is keen to see that the line is revived and not grounded at a time when aviation in India is growing.

Ajay Singh, SpiceJet chief, has called for policy changes to see that the aviation sector in the country grows.

It is important to keep the large network of routes of Jet Airways in order, so that in the future, the flight routes can be served again.

The next few weeks and months will be watched with keen interest in India and abroad, as things shape up, depending on several factors.

The country is also going to soon hold elections, and the outcome may also have an impact on the aviation scene.

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“Plan For Our Kids” and “African Earth Lung” to launch at WTM Africa

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eTN Publisher Juergen Steinmetz talks to Professor Geoffrey Lipman Co-Founder of SUNx – STRONG Universal Network, about the development of “Plan For Our Kids” and the signature “African Earth Lung” to be launched during WTM Africa.

Steinmetz  

Hey Geoffrey, I wanted to get an update from SUNx for  WTM Africa

Lipman

Hi Thomas, we’re just rolling out “Plan for Our Kids” (PFOK)  launched at WTTC’s COP 24 event in Poland at the end of last year. Its goal is to create 100,000 STRONG Climate Champions by 2030 across all UN States. It’s a low cost, CSR linked program, with lifetime learning, from school through graduation into corporate training programs, and it will support Climate Friendly Travel ~ measured to manage: green to grow & 2050 proof to innovate. It will provide cloud connected online education, analytics and a heavy emphasis on innovation, to spread best practice around the system.

Steinmetz

Why is this different from what other organizations like WTTC or UNWTO do ?

Lipman

It’s complementary to all the excellent SDG related sustainability initiatives, of industry and government organizations – across the mobility, hospitality, technology spectrum.  PFOK is just totally focused on responding to eXistential Climate Change. Because if we don’t fix that, all the other stuff won’t matter. So, it targets the next generation of decision makers. And we are appealing to companies and communities who connect with them for the strategic engagement and financing support to make it happen. Industry leaders, financial services, technology innovators all have a massive stake in the future. SUNx is just a catalyst.

Steinmetz 

Why the next generation……… What about now?

Lipman

Climate change is a multi-generational issue. The last generation defined it: This generation recognized it. The next generation will be in the middle of it. They don’t have the institutional baggage and they will have the mindset to implement solutions.

But we have to start now – that’s the climate scientists’ message: that’s the economists’ message and that’s the Greta Thunberg message.

I kind of like the Titanic analogy.  At the end of the day we have to avoid the iceberg and if we do that the ship sails on, life carries on and evolves. But the ship takes a long time to change course – in the case of the Paris Agreement 5 years from 2015 inception to 2020 coming into force. 2030 to ramp up and integrate with the SDG’s And 2050 to stabilize at liveable weather conditions.

Steinmetz

OK why 100,000 STRONG Champions– or did you pull the number out of the air.

Lipman

Well it’s a significant target of educated thought leaders – even for a global  movement – but it’s basically the equivalent of 500 for every UN State. Even for a small island that’s not huge. For a big State we know it will spawn more. And we have a decade to put them in place. They’ll be the Greta Thunberg support system for our sector – helping ensure that Paris targets are met. What’s exciting is that we will be able to provide them with dynamic lifetime learning from our web portal, focused good practice from across the global climate resilience spectrum and a capacity to spread innovation on a real time basis.

Steinmetz    How Will you Finance such an Ambitious Program

Lipman

Visionary Corporate Sponsors from the Travel & Tourism sector and supporting industries, as well as far thinking public sector sources; will take it to scale, country by country. We have a Sponsor and Impact Investor program, as well as a country initiative that costs just 5000 Euro. And we operate as an NGO with low costs and high focus.

We’ve been fortunate to find our first Anchor Sponsor, of 12 we are seeking worldwide for 2019/2020 – and we are grateful to Robin Ingle for his willingness to step up to the plate so quickly. Our plan calls for one from each sub-sector – Transport: Hospitality: Travel Services: from each of 3 regions. Americas: Europe / Middle East/ Africa: Asia/Pacific. As well as one leader per UN State.

Our signature African Earth Lung will of course  require a much bigger Alliance, with much greater finance. But frankly it’s a once in a lifetime opportunity to do something that can have such clear global and local significance. I  saw it before at Rio 92 when Maurice Strong mobilized so much for the planet and a focus on the Amazon. We think this is our chance to help the world and the Congo Basin.

Steinmetz Will you ever stop this kind of corporate campaigning

Lipman

I doubt it.  I worked for IATA for the first 20 years of my career – a wonderful organization that instilled a sense of purpose –  its first Director General told a journalist when he was in his 90’s, that his days began by crawling out of bed to get the Times Newspaper from the doormat. He turned to the obituary column and if he wasn’t there, he got dressed & carried on with life. I’m kind of from that school of thought.

For more information on SUNx, please visit: https://www.thesunprogram.com/

3 min Video About SUNx

 

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