Indian Airline Bets on Service That's Better

High-end Indian carrier Jet Airways will start North American service next month at Newark airport in one of the most aggressive launches ever for long-haul intercontinental service.

Jet Airways is scheduled to fly daily from Newark to Mumbai, India, starting on Aug. 5. It will add Toronto-Mumbai service on Sept. 5. By January, it will add daily service from New York John F. Kennedy and San Francisco. Flights will stop in either Brussels or Shanghai, and travelers will have the option to start or end their trips in those connecting cities.

Consultant Craig Jenks, president of Airline/Aircraft Projects, says Jet's North America launch involves a commitment of eight new aircraft valued at about $1billion. Most airlines start more conservatively, often scheduling one round-trip flight to test the market, Jenks says.

"It's very bold to introduce four flights within a few months," Jenks says.

But Chairman Naresh Goyal, 57, has a lofty goal: market dominance. "In the next five years, we want to be the first preferred carrier to India," Goyal said during a recent interview in Washington, D.C.

Jet Airways is not well-known in the USA. But Goyal believes Jet can make a dent in the market with superior service, luxurious accommodations and its familiarity to India expatriates in the USA and to frequent travelers to India. Goyal says Jet typically fetches a premium of about 25% over other Indian carriers.

Posh flying

First-class travelers on Jet will experience some of the poshest flying in the sky today.

On Jet's London flights, for instance, the 777's first-class section is divided into suites that have their own shutterlike doors. Inside, there is a seat that reclines into an 83-inch-long lie-flat bed, a 23-inch entertainment monitor and dual credenzas that eliminate the need for overhead-bin storage. It's unusual now but may not be when carriers such as Singapore and Lufthansa introduce their new A380 jumbo jets. Goyal is positioning Jet to rival Singapore in terms of its high level of service and perks.

"It's great to see another carrier that shares our philosophy of offering luxury experience to the consumers. It's more choice," says James Boyd, spokesman for Singapore in the USA. "We certainly will be happy to compete."

Even Jet's economy customers will see a difference, especially from U.S. carriers. Though they'll get a smaller TV screen than in first class, they'll have access to the same touch-screen entertainment system, Goyal says.

A former travel agent, Goyal launched the airline in 1993 as a charter operator with two leased jets. Jet gradually evolved into an international airline as India dropped air service restriction laws. Today, Jet flies to 50 destinations, including Singapore, London and Bangkok.

Despite Indian laws that then forbade private airlines from advertising schedules, the entrepreneur initially drummed up business by advertising flights at "breakfast," "high tea" and "dinner" time, and by relying on word of mouth.

The first year, Jet carried 734,000 passengers, ticketing them from a small table at Bombay airport, because it hadn't been granted counter space, Goyal says. There were no toilets nearby and only one computer.

Today, the carrier has 62 aircraft and has become India's biggest private domestic carrier. It carries about 12 million people a year. Steering Jet from just two planes to a world-class international airline has made Goyal a wealthy man. This year, he landed on Forbes' billionaire list at No. 754, with an estimated net worth of $1.3 billion. He says he owns 80% of the airline, which has been profitable from the start.

While the U.S.-India air market is still a relatively young market, it's already competitive.

Air India offers direct flights from four U.S. airports: JFK, Newark, Los Angeles and Chicago O'Hare. But the market is dominated by European carriers such as Lufthansa, Air France and British Airways.

Lufthansa is the biggest European carrier from the USA to India. It just announced Orlando as its 17th U.S. city and added service from Germany to a sixth Indian city, Kolkata. This year, Lufthansa's carrying 20% more customers than last year while expanding capacity by 6%.

"India is a key market for Lufthansa," says Dirk Janzen, a Lufthansa executive who oversees its India business. "It's a $2 billion travel market, so it's natural that you see new entrants coming in."

U.S. airlines mainly serve India through partner airlines, allowing customers to earn frequent-flier miles. Some have launched their own non-stop flights to capitalize on growing demand. American has a non-stop flight from Chicago to Delhi. Delta now flies daily between JFK and Mumbai, while Continental flies daily between Newark and Delhi.

Once service is established, Goyal expects to increase the frequency of flights on some routes and later add non-stop service.

'It's my first choice'

Customers are watching Jet's launch as closely as Jet's rivals. Chekitan Dev, an associate marketing professor at Cornell University, for instance, flies Jet almost exclusively when in India.

"It's my first choice, because they've established a reputation for service and on-time performance, the two priorities for me," Dev says. But he's torn about switching from Lufthansa and the mileage benefits of its Star Alliance.

Bala Subramanian, a cardiologist based in Orlando and Delhi, says he will stay for now with OneWorld alliance carriers British Airways and American Airlines even though he thinks that Jet's "service is better than British Airways."

Frequent traveler Bala Vasireddi, who works for a U.S. company in Hyderabad, India, and travels several times a year to the USA, considers Jet one of the best airlines in the world. For him, price will be one of the deciding factors in whether he switches from Lufthansa and KLM to Jet.

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