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 the 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 was doomed to end as the public perception and preferences of air travel had changed a lot.

Indigo with its Southwest model of airline carrier business, bought the competition to the airline industry with its aggressiveness, cost reduction, and price wars.

Jet could neither imbibe the same, nor could it acquire a loyal clientele.

Indigo’s policy was simple -

• It leased airlines of all the same type, product, and category and standardized all its processes.
• It differentiated from others being the on-time airlines.
• It used the no-frills model of flying, and the seats had no push back either.
• So Indigo Airlines was a glorified mofussil bus service, where it expects the customer to sit in one place idle for 2–3 hours while they transport you from X to Y.

Compare that to Jet airways, which wanted people to enjoy the travel, with food, business class, and amazing interiors.

This meant, the cost of jet airways was multiple times higher than Indigo and they had to be priced higher.

But the customer demand was never there and had ceased to exist for luxury travel, people were OK with traveling cheap and reaching rich.

Apart from that, the financial statements should give you a better picture, as I feel jet airways had over-leveraged itself.

In addition Jet Airways had two wonderful opportunities to pull itself out, first was one American carrier Delta airways offered to buy Jet Airways, and second when TATA Vistara Airlines wanted to acquire Jet airways, somehow both did not sail through.

But all is not lost, with Mukesh Ambani and Saudi Aramco (Consortium), and multiple others now trying to get into the airline segment and have proposed a bid for acquiring Jet, I hope the airlines survive this tremor and bounces back.