Etihad Airways Acquires 24% of Jet Airways

Etihad Airways has commenced major expansion of its Indian operations following the approval of a 24% investment in Jet Airways.

Central to the Etihad Airways plan is the use of Abu Dhabi, capital of the United Arab Emirates, as a global hub connecting international passengers and freight with flights to and from India.

Pending the opening of a new facility, USA-bound passengers will be able to clear US immigration and customs at Abu Dhabi International Airport.

The first stage of the Etihad Airways strategy includes additional flights or the introduction of larger aircraft on existing routes to India.

The initial flight increases by Etihad Airways are:

• Mumbai and New Delhi: 7 to 14 flights per week (immediate)
• Kochi: 7 to 14 flights per week (June 2014)
• Bangalore and Chennai: 7 to 14 flights per week (July 2014)
• Hyderabad: 7 to 14 flights per week (October 2014)

As well as more flights, Etihad Airways is introducing larger aircraft in some markets.

On the Abu Dhabi-Mumbai and Abu Dhabi – New Delhi routes, evening flights with narrow-bodied Airbus A320s have been upgraded to wide-bodied Airbus A330 and A340 aircraft. On the Mumbai services, this includes introduction of Diamond First Class private suites on the evening A340 flights.

New Airbus A321 aircraft, seating 174 passengers, will be used on all Abu Dhabi-Chennai services, and between Abu Dhabi and Kochi from June 2014.

Subject to regulatory approvals in a range of countries, Etihad Airways and Jet Airways also plan to codeshare on each other’s flights between Abu Dhabi, India and other markets in the Middle East, North America and Europe.

Etihad Airways will also codeshare on new flights by Jet Airways’ between India and the USA, via the Abu Dhabi hub, subject to regulatory approval.

“India is one of the world’s largest and fastest-growing air travel markets, and will play an increasingly important role in our growth,” said James Hogan, President and Chief Executive Officer of Etihad Airways. “Through our purchase of 24% of Jet Airways – the first foreign investment permitted in an Indian airline – we have laid the foundations for major and exciting growth in air services between Abu Dhabi and India, and beyond throughout our global network ... Subject to receiving regulatory approvals, we will continue to expand our Abu Dhabi – India operations and work with our growing stable of partners to accommodate strong growth and deliver much greater choice for travel to and from India.”

In addition to Jet Airways, Etihad Airways has invested in airberlin (29%), Air Seychelles (40%), Virgin Australia (19.9%) and Aer Lingus (3%). Etihad Airways also is awaiting regulatory approval to acquire 33.3% of Swiss regional carrier Darwin Airline and in January 2014 will activate a 49% investment in Air Serbia.

“Our equity alliance enables much deeper cooperation than can be achieved through a standard commercial partnership,” Mr Hogan said. “In addition to joint activities which increase revenue, the relationships we have with our equity partners enable us to reduce costs and increase efficiencies through activities such as resource sharing, knowledge transfer and joint procurement.”

Both airlines are exploring synergies ranging from integration of their loyalty programs to shared airport facilities and offices, common training of pilots and flight attendants and deployment of joint sales forces in markets served by both carriers.