Will the Kingfisher be grounded ? Debate
The final tranche of 50 pilots seem to have deserted Kingfisher to join Indigo, further cancellation of flights and freezing of bank accounts have all added upto the woe. I feel personally it is mismanagement to a large extent which has perpetuated the situation. A niche airline is not feasible in India ? with coverage of tier 2 and tier 3 cities mandatory, secondly non refundable ticketing policy, and finally code sharing arrangements not in place. Debate guys
And I beleive government should sell Kingfisher to some professional company and sack Malya.
Kingfisher is now once again in deep trouble this time around pilots resort to protest by taking mass leave. I believe VM should merge Kingfisher with the parent company UB and put an end to all speculations.
I would have booked 10 tickets on KFA but refrained from doing so because of the uncertainty of flights taking off. Being a shareholder i still cannot support KFA and put my clients into soup 
Well Aviating in India will once again have a boom may be regulatory policies are not favoring it right now.. Thr right spark will be out soon...
Its not a problem with regulatory policies, in US its much more stringent than what we have. The problem is with entire cost structure.
Kingfisher (before takingover Deccan) was a premier airline, and prices were bit higher than normal flights (I used to prefer them over others). But after KFA and Deccan together, they become a budget airline, rather than being a niche brand, but maintained all the niche factors of a premier airline. Will this cost over fare would earn anyone profits?
No no no no
Raowords, VM has never agreed so far to treat KFA as budget airline which is a big b****er. At least the Deccan flights he should have maintained as budget airlines and run the KFA as niche model in trunk routes. I believe Indian consumers are highly cost conscious, further cancellation charges and no refund policy has added to the woe.
i heard lenders are giving 1000cr, booster dose.
looks like greece bailout mess, lenders have no other option to save their mess.
Pramod i am sure Kingfisher is already bailed out, SBI is willing to lend any amount in good spirits :)
I guess that's fair enough. Besides, SBI ain't that easy to deal with to get money, So I am sure they must have done a lot of paperwork to be absolutely sure.
Besides, All he needs to do now is give "exclusive SBI Kingfisher" calenders ;)
The SBI union has put in a spoke for 1500 crore additional loan, i believe that they want to save SBI shares from falling. I feel personally that VM and shareholders of United Breweries should take a call to merge it and absorb the losses temporarily.
He will surely play in this market, it could be very deceptive:
His options are:
1. Liquidate his positions in the market. (But this bit difficult, due to insider trading restrictions, this might land up him in jail for long time)
2. Or buy back all the KFA stocks from the market, at cheaper prices when market's fall (Some big organisations had used this trick earlier).
Whatever might happen, his personal assets are safe. So he wouldn't do anything and he will just wait and watch. OR pursue our Govt. to bail KFA out.
First stock that will take a huge hit would be KFA.
Followed by all airline stocks & VM's group companies
We could see some low's in the market.
But in long run its good for the market & airline companies (All the passengers lost by one airline is a gain for others and might probably one or two airlines might turn in green sooner than expected)
That's a good news. But I'm still wondering what does Mr. Mallaya gains out of all this? One thing I'm sure that he is playing some game. What is that?
Indigo airlines will be listed in the market shortly, they are the only airline making profits. Why not other airlines follow their model, they don t have many offices, and obviously understaffed. I am sure they have recruited 50 odd pilots from KFA at lower salaries. Who knows they might acquire the excess aircraft of KFA too
I really hope not, because Mallya has done too many good things for people who are in need.
I just hope that all of their blessings help him to come out of this!
Can you name some of the good things that VM has done to people Lolz
Against:
KFA shouldn't be liquidated, it was the only airline which had some good looking airhostesses ; )
In the month of Novement 2011, I had written an article on the same issue with a detailed analysis on KFA's balancesheet for the past 6 years.
Its not only the problem of KFA, other airlines are also loosing money. The whole cost accounting of the airline industry is incorrectly built, as its based on low budget airlines, its totally incorrect.
In India the air fare for a distance of 1,000kms is around Rs.4,000 but in UK / US for the same distance is around Rs. 6,000+. Would these airlines earn profits, nope, never.
I never understood how these costs are calculated and what is the tax rate. It seems a puzzle to me how two tickets of same price have different taxes...
Good looking air hostesses unpaid cannot guarantee their looks Lolz. I feel the pricing of airline tickets and policy of no refund or huge cancellation fees is an issue. ATF taxation is an issue, a uniform taxation of 6% to 9% would be ideal across India. The costing of airline goes haywire if one fuels in Bangalore which charges 28%, Mumbai 26%, whereas in Delhi it is 16%, Goa 12%, logically fuel cost is 40% of the pricing. If that logic is taken forward than lower taxation would reduce the cost of ticket. The infrastructure of Kingfisher is another issue with too many staff and offices. Imagine they had excess pilots too, now with the exodus, it will bring their costing by 50%.
If this issue had occured in UK & US, Mallya would have been forced to liquidate his holdings in Force India & RCB and pay off his stakeholders.
It's appalling the way governance is being bludgeoned so blatantly. Mallya, have a heart and care for people who work for you. You're kicking theirs & their families' stomachs.
Umesh, I think nothing will happen to KFA. They'll continue to bleed and invariably run like an NPA like AI. The only people to suffer will be staff, investors and travellers.
I feel the ego of VM is coming in the way of airline turning around. He wants to offer 5 star facility with 2 star pricing which is not possible, he should first of all be down to earth, learn few tricks from his United spirits business. Volume should be first priority. His airline should not cater to bollywood stars and cricketers alone.
I think King fisher should be declared bankrup and put on the block. Government should not bail him out. Hopefully a more professional group can take it over and run it more professionally.
I believe this airline can be turned around if they stick to mass model instead of class model.
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