Jet Airways European Expansion on Hold

Wednesday, 24th April 2013 at 10:57am

The Indian budget carrier earlier got the nod from the ministry of civil aviation for its expansion plans in Europe including the granting of rights to mount 35 new flights to Germany's third largest city, Munich. The Jet's expansion plans will include the creation of Munich as its European hub to expand its network in the continent.

Jet is also in talks with Germany's flag carrier Lufthansa to facilitate its entry to Star Alliance, the first and currently the world's largest airline alliance. Along with it, it is also working with the German airline to help establish a hub in Munich.

The postponement of its expansion plans in Europe came on the heels of the latest development in the aviation industry in India. In September last year, the government amended its decades-old FDI policy of foreign ownership of a local airline which has been increased up to 49% stakes.

As a result, Jet Airways was able to attract Etihad Airway to invest in the former through equity acquisition. Now, its stance on earlier expansion plans in Europe has changed directions.

Until the equity acquisition deal by Etihad is officially closed, Jet will put any expansion plans on hold including the planned hub in Munich. However, it has clarified that its expansion into Europe will still push through.

As soon as both airlines finalized the deal, both will discuss about their respective expansion plans which include the reworking of their respective routes serving the Indian market. According to an industry expert, Abu Dhabi stands to gain from the Jet-Etihad deal and a loss to Brussels and Munich. Jet Airways will choose between the latter two cities as its future hub in Europe for its network expansion.

Jet has been seeking from the ministry additional entitlements to fly to Abu Dhabi and other cities in Southeast Asia for the summer schedule. The ministry, in advance, has already granted Jet rights to fly with three schedules.

On the other hand, officials from Munich Airport flew in the country to meet with Jet officials to discuss important matters regarding the latter's plans in Europe.

Christina Werkstetter, the director of traffic development business division aviation of Munich Airport, confirmed the report that both officials from Jet and Munich Airport were in talks about the airline's plans for Munich. However, she added, the plan was indefinitely put on hold by Jet following the recent development (Etihad's equity acquisition in Jet).

The Munich official is hopeful, however, that the deal with Jet and the airport will push through regardless of the outcome between the Etihad-Jet deal. She said that Munich Airport welcomes any Indian airlines to add more flights to Germany.

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