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Page last updated at 11:54 GMT, Wednesday, 15 October 2008 12:54 UK

Jet Airways lays off 800 staff

Jet Airways crew leave the domestic airport in Mumbai on October 15, 2008.
Jet Airways has cut down on the number of flights it operates

India's largest private airline Jet Airways has laid off 800 employees as it cuts flights amid soaring costs.

The company said cabin crew hired for a planned expansion programme which had been suspended would lose their jobs.

Hundreds of members of staff gathered in the city of Mumbai (Bombay) to protest at the move.

Jet says it plans to cut more jobs. Its announcement follows a recent cost-cutting alliance with India's second largest private airline, Kingfisher.

The deal, announced on Monday, will include route sharing and the joint use of crews - although Jet says the job cuts are not linked to the tie-up.

The two airlines, which have nearly 60% of the market in India, said the rise in the price of jet fuel by a quarter this year was a major factor in wanting to join forces in order to cut costs.

All they're giving is one month's basic salary. How can anyone manage?
Manav,
Former Jet employee

According to reports, Kingfisher Airlines is also considering laying off some of its staff.

India's aviation industry has boomed as the country's economy has grown in recent years, with new airlines offering bargain flights around the country.

But rising fuel costs over the past year have pushed up ticket prices, and fewer passengers than predicted are opting to fly.

'Painful'

"As a first step, around 800 flight attendants, recently recruited for the planned expansion programme, which has now been suspended, have been released," a statement issued by Jet Airways said.

The company says it plans 1,900 job cuts in total.

Chief Executive Officer of India's Kingfisher Airlines Vijay Mallya (L) and Chairman of India's Jet Airways Chairman Naresh Goyal address media representatives after a meeting in Mumbai late October 1
Mr Mallya (left) and Mr Goyal need to save money

"The other categories include probationary and unconfirmed personnel in other areas, including cockpit crew and management personnel, to reflect the lower number of flights and seats offered."

The airline says it will be offering 15% fewer flights than scheduled this winter because of "declining traffic volumes".

Meanwhile, hundreds of the airline's staff gathered in uniform in Mumbai to protest at being sacked.

Some cabin crew said they had received letters terminating their employment on Tuesday, while many others had received letters on Wednesday.

Some said they had yet to receive letters.

One former Jet employee, Natasha, said: "I was working for another airline before this. But I joined this to be in India. I just flew last week. There are no complaints. How can they terminate our jobs just one fine day. The letter gives no reason. This is no way to go about things."

Another, Manav, said: "I'm not from Mumbai. I've taken a place on rent. Paid deposit, spent so much on courses. All they're giving is one month's basic salary. How can anyone manage?"

In its statement, Jet Airways said its alliance with Kingfisher Airlines had nothing to do with the job cuts.

"We wish to clarify that the reconsideration of our operations has been ongoing for some time now and this adjustment in personnel numbers did not result from the planned alliance with Kingfisher Airlines.

"If at all, improved economies in other areas would help obviate such a step in the future."

'Benefits'

The two airlines, which have a combined fleet of 189 aircraft, say their alliance will be of mutual benefit.

They say there was a 33% increase in passenger numbers last year, but growth this year has slowed to 7.5%.

Jet Airways chairman Naresh Goyal spoke of "huge cost savings and revenue enhancement opportunities".

In recent years, more than a dozen private airlines have sprung up in India.

Recent years have seen consolidation. Last year Kingfisher merged with another rival airline, Deccan, and Jet, the country's largest domestic carrier, bought Air Sahara.

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SEE ALSO
Shock of Indian airline job losses
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Indian airlines agree on alliance
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Jet Airways strikes Sahara deal
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India Airlines strike 'is over'
14 Jun 07 |  South Asia
India worried over air fare wars
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