Why So Many Indian Airlines Failed

The stories of Kingfisher, Jet Airways and Go First, and the common reasons Indian airlines have collapsed despite booming demand.

India’s skies are littered with failed airlines. Despite rapid growth in passengers, many carriers collapsed. Their stories reveal the harsh economics of flying.

Kingfisher Airlines

Launched in 2005 by businessman Vijay Mallya, Kingfisher offered luxury service at a time when low-cost carriers were cutting fares. It bought Air Deccan, a budget airline, mixing two different models. Heavy losses and debts followed. Kingfisher stopped flying in 2012, leaving banks with large unpaid loans.

Jet Airways

Jet Airways, founded by Naresh Goyal, was once India’s largest private airline and a symbol of quality. But it faced:

Fierce competition from low-cost carriers.
High fuel prices and a weak rupee.
Heavy debt.

Jet stopped flying in April 2019. Attempts to revive it through insolvency proceedings failed, and in 2024 the Supreme Court ordered its liquidation.

Go First

Go First, formerly GoAir, was a low-cost carrier owned by the Wadia group. In 2023, it filed for insolvency, blaming faulty Pratt & Whitney engines that grounded about half its fleet. Lessors tried to repossess planes, and the airline stopped flying.

Common reasons

High fixed costs and thin margins.
Fuel costs and exchange rates, since many costs are in dollars while revenue is in rupees.
Price wars with low-cost rivals.
Heavy debt and weak finances.
Poor strategy: mixing full-service and low-cost models.
Supply shocks, such as engine problems.

Consequences

Passengers stranded and refunds delayed.
Employees lost jobs and unpaid salaries.
Banks and lessors suffered losses.
Fewer competitors meant higher fares on some routes.

The stranded passenger

A traveller books a Jet Airways ticket for May 2019. In April, the airline stops flying. His refund takes a long time, and he must pay a higher fare on another airline because fewer seats are available on the route.

Thinking airline failures happen only because of bad management

Management matters, but fuel, currency, competition, debt and supply shocks also make aviation very risky.

Key takeaways

Kingfisher stopped flying in 2012; Jet Airways in 2019; Go First in 2023.
Common causes include high costs, fuel, currency, price wars and debt.
Go First blamed faulty engines that grounded much of its fleet.
Failures hurt passengers, workers and lenders, and reduced competition.