Jet Airways has announced a new enhanced cooperation agreement with the Air France-KlM Group, a move that will boost connectivity between 106 European cities and 44 domestic destinations.
“This enhanced cooperation agreement between Jet, Air France-KlM Group represents the next stage of our journey of offering better connectivity across our combined global networks,” Jet Airways Chairman Naresh Goyal said announcing the partnership here on Wednesday.
This is the first major announcement by Jet, the second largest domestic airline by revenue, after it relocated its European hub to Amsterdam from Brussels in March 2016.
The agreement, which primarily deepens their already existing codeshare partnership signed in 2014, will further boost connectivity between India and Europe as well as between Europe and North America through a similar pact between the three networks and Delta Air lines of the US.
Goyal, however, said the partnership with the Gulf carrier Etihad, which holds 24 per cent stake in his airline, will continue and will not be “disturbed”.
“I believe this partnership with AF-KlM will be very good for us. We’ve a great relationship with Etihad, which will continue and will not be disturbed at all,” he said.
“We’ve done well with Etihad and will continue to do so. There are 70-80 lakh Indians in the Gulf. Travel demand between India and the West will be both via the Gulf route and Europe, and also direct to Europe,” Goyal added.
Whether the new partnership could lead to investments in Jet from the European airlines group, Goyal quipped, “one does not know what happens in future”.
Significantly, Goyal had earlier categorically ruled out selling stake to another airline/investor or Etihad exiting from the joint venture.
“We’ve no plans to sell stake to another investor. Also, our partner Etihad has no intention to exit Jet,” Goyal had said on September 11.
The new route pact apart, the existing tie-up between the AF-KlM and Delta will help connect India to a Trans-Atlantic network with hubs in Amsterdam and Paris.
As part of the agreement, Jet passengers will be able to book a single ticket for a trip to the US and Europe, and fly Delta, Air France-KlM or Virgin Atlantic.
Flights will be “metal neutral,” which means revenue will be shared regardless of whose aircraft is deployed. Unlike interline or codeshare agreements, a joint venture follows the principle of metal neutrality in which revenue/profit is shared on a pre-determined basis on select routes and it does not matter which airline flies a passenger.
The partnership is expecting an incremental revenue to the tune of $1 billion, Goyal said without offering a timeline for achieving this.
He also said his airline has applied for securing a slot in the Delhi airport to launch a fourth flight to london, which will help it cater to the US traffic through Virgin Atlantic.