Why do Indian airlines keep crumbling one after the other, with the latest example being Jet Airways?
Multiple reasons and not just one. The failure of a company can never be attributed to one cause or event(very rarely if that happens), it involves multiple reasons and systems to fail simultaneously for a company to fail. Economically the airline industry is an oligopoly industry, with very little premium or monopolistic advantage one can derive. The industry's prices follow a KINKED DEMAND CURVE , which means that your competitors won’t raise the price when your rise, but when you cut prices to capture market share your competitors would follow you. Added to t h e above, jet fuel follows a rocket and feather phenomenon of pricing. This means when there is a rise in the price of crude, the oil companies transfer the cost of airlines, whereas when there is a fall in the price of crude the oil companies artificially keep the price high and capture more profits in hand squeezing the downstream industries. The business model of jet airways w...