sHRishti
SpiceJet Flies into Turbulence

The aviation industry in India is facing turbulent weather in recent times. As the aviation industry is gearing up to tap the potential market of 99.5% of the country’s population 1, the news of one of the country’s prominent low cost carriers in trouble, for the second time in three years has raised a lot of eyebrows.

The recent rescheduling/cancellation of SpiceJet flights have left irate passengers stranded, as the air fares of other airlines have shot up to 3 times. The company is facing a serious financial crunch of Rs 2000 crores to pay its debtors and meet the salary bill. Everything in this industry seems to be a fixed cost! There is also news about DGCA withdrawing slots for flying. The cyclic effect of operating cash shortage can be an indication of turmoil in the aviation industry. Pilots sense trouble and bail out to the competitors, the left over tend to fly extra hours which makes the travelers’ fearful of pilot fatigue. It’s all the money game. Only the ‘moolah’ gets you the fuel which is used to fly the aircraft and therefore the question arises whether to have all the pilots in the cockpit or the fuel to run the carrier. The same problem arises when it comes to fees related to takeoff and landing and other fixed expenses. The next major concern is the other employees…the engineers, flight attendants and the ground staff. They need to be paid too. Rs. 2000 crores is nowhere in sight though the Government has just used its goodwill to get

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Rs. 600 crores to keep the wings in the air and there is some news of the promoters willing to part their shares to other investors.

You are the CHRO of the airlines and the Chief Operating Officer has asked you to work something out with the pilots and the staff to differ their salary. You are aware that people are never in a mood to give up their