Jet Airways India Ltd. is running out of money, forcing it to weigh re-starting bailout talks with Tata Group, the nation’s biggest conglomerate, according to people with knowledge of the matter.
Tata said in November that it held “preliminary” talks with Jet Airways though no proposal was made. Acquiring Jet Airways’s business could give the conglomerate’s fledgling aviation unit a shot at dominating the fastest-growing major air-travel market, where fares as low as 2 cents have kept the industry unprofitable for a decade.
Industry Challenges Crushing fare wars are a hallmark of India’s intensely competitive aviation market, and Mumbai-based Jet Airways hasn’t seen a profit in nine of the past 11 fiscal years. Losses at Indian carriers will balloon to as much as $1.9 billion in the year ending March 2019, and they need to raise more than $3 billion in working capital in the near term, according to Sydney-based consultancy CAPA Centre for Aviation. Most of them have cash balances that can cover expenses for only two to three weeks, according to CAPA.