Embattled Indian air carrier Kingfisher announced last week a revival plan. Except that no one seems to believe his CEO and President, beverage moghul Vijay Mallya…
NEW DELHI- Kingfisher Airlines saga is like an Indian TV soap opera: endless and singing (almost) the same tune. Vijay Mallya, the airline’s CEO was announcing to disgruntled employees that it planned to restart operations by the beginning of the 2013 summer schedule in a limited way with seven aircraft. The new Kingfisher will then progressively gain in power to finally put back into operations up to 21 aircraft in the next four months. Globally, the summer schedule of airlines starts from March and extends till October. Kingfisher hopes to be back on its feet with a fleet of 57 aircraft within 12 months of recapitalization.
However, newspapers also reported that Kingfisher Airline’s plans could tumble as senior government officials indicated to doubt the airline’s plans to invest Indian Rupees 6.5 billion to restart operations, as it might not guarantee efficient and reliable services.
“The revival plan, which was submitted by the airline, had lots of issues regarding lenders and staff payments which we felt may not lead to reliable services,” a senior Government official said to the Hindu newspaper.
The revival plan submitted to the Directorate General of Civil Aviation (DGCA) also has no provisions for paying airport operators, the officer said. Also payment of staff salaries and wages in a phased manner could lead to a situation where the airline may not be able to provide reliable services because if its staff were not paid, they may stop working again and this could inconvenience passengers.
Another major difficulty for Kingfisher is also to find private investors into the ailing carrier. Etihad Airways, mentioned at some points to take over the carrier- categorically denied to be interested. India’s UB Group has however indicated to be willing to provide up to IRs 6.5 billion necessarily to restart the carrier’s operations. Last Friday, the Hindu newspaper indicated that a group of six banks met in Bangalore to discuss the viability of a restart plan presented by the airline. “They were however not enthused by the proposed plan as it did not have any firm commitment from the promoters on fund infusion in the airline,” according to the newspaper…
Luc Citrinot a French national is a freelance journalist and consultant in tourism and air transport with over 20 years experience. Based in Paris and Bangkok, he works for various travel and air transport trade publications in Europe and Asia.
