Jet Puts Munich Expansion on Hold till Etihad Deal Takes Off

March 29, 2013
Jet Airways,which is in talks for a strategic partnership with Abu Dhabi-based Etihad Airways,has put on hold its plan to expand its network in Europe through Munich airport,till its deal fructifies with the Middle-eastern carrier.

Jet Airways,which is in talks for a strategic partnership with Abu Dhabi-based Etihad Airways,has put on hold its plan to expand its network in Europe through Munich airport,till its deal fructifies with the Middle-eastern carrier.In the recent winter schedule (from October 28),India's second-largest airline in terms of market share was granted permission from the ministry of civil aviation to start 35 new flights to Munich.To facilitate its expansion of routes into European cities,Jet was in talks with German carrier Lufthansa for membership in Star Alliance - one of the largest global airline grouping,along with a hub at Munich airport.The changed scenario,after the ministry approved foreign carriers to invest in Indian airline firms,has now forced Jet to change its stance.It has adopted a 'go slow' approach in actively pursuing Star Alliance membership and also is in the process of reworking its European expansion plans.Jet confirmed that it has put on hold its plans to expand in Munich till such time as the deal with Etihad is in the works."It's correct that we have put on hold our expansion in Munich.But our overall expansion in Europe is not on hold till the deal with Etihad is finalised.We are still finalising our expansion plans in Europe and cannot discuss them at this stage," said Jet Airways CEO Nikos Kardassis."Jet's move is in line with a continuous string of positive news coming out of the ongoing discussions between Jet and Etihad.If the deal goes through,there will be a significant reworking of Jet's and Etihad's routes catering to the Indian traffic.Brussels' and Munich's loss will be Abu Dhabi's gain," said global consultancy KPMG's partner and head,aviation,Amber Dubey.Jet has sought additional flights to Abu Dhabi and other South-East Asian cities from the ministry for the summer schedule that commences from March and in a changed rule the ministry now grants flying rights for three schedules in advance.Officials from Munich Airport,who were in India last fortnight to discuss with Indian carriers planning to fly into Germany,said they are awaiting Jet's response on the commencement of flights.Confirming this,Munich Airport director for traffic development,business division aviation,Christina Werkstetter,told ET: "Currently,the move is put on hold by Jet.We are in discussions,but in the wake of new developments (deal with Etihad),we will have to see how things unfold.We are watching the deal very closely and we have to be patient." "We could not manage to attract Air India," rued Werkstetter,and added that India is a strong market and they are trying to attract Indian carriers to add more flights to Germany.But the German airport official did not rule out an alliance even if Jet takes on board Etihad as a partner."The aviation market is getting used to the new and changing environment and classic alliance structures will open up to keep with changing times," she said.Werkstetter was referring to another Middle Eastern carrier Qatar Airways joining Oneworld,which has major European carriers as part of the alliance.In February this year,Jet Airways had announced a sale and lease-back of its Heathrow-London slots to Etihad Airways for $70 million.In another indication of a burgeoning partnership between the two,Jet leased a wide-bodied aircraft along with 60 of its cabin crew to Etihad last Monday.Aviation analysts see this move by Jet to wet-lease aircraft to Etihad as the beginning of many more of such initiatives as they feel that the planned partnership between the two could be more of a comprehensive strategic and alliance rather than just an equity

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