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HindustanTimes Wed,01 Oct 2014

Kingfisher cancels flights on labour woes

AFP  New Delhi, October 01, 2012
First Published: 08:38 IST(1/10/2012) | Last Updated: 21:11 IST(1/10/2012)

Cash-strapped Kingfisher Airlines cancelled all of its flights on Monday due to staff unrest, adding to doubts about the ailing private carrier's future and sending its shares plunging.

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RK Khanna, deputy director-general of India's civil aviation regulator, said no Kingfisher flights had operated Monday and that they had summoned the carrier's chief executive Sanjay Agarwal to discuss the problems on Tuesday.

"The airline will have to explain how long the cancellations will continue," he told AFP.

Kingfisher, which is desperately in need of capital to keep flying, said earlier in the day it had cancelled some flights because of problems with staff, who have not been paid for months.

"A section of our employees have been threatening and manhandling other employees who are reporting to work. We are anticipating disruptions and delays of flights across our network," airline spokesman Prakash Mirpuri said.

"With a view to mitigate the impact of these anticipated disruptions, we are proactively cancelling several flights across our network for October 1," he said in the statement, adding the firm would talk to employees on the issue.

Kingfisher shares fell by their highest permissible daily limit, ending down 4.78 percent at 15.35 rupees on the Bombay Stock Exchange, following the news.

The Press Trust of India news agency reported some Kingfisher engineers had gone on strike to demand wages unpaid for seven months.

On Sunday night, passengers landing in big metros such as Delhi or Mumbai were stuck inside their aircraft as Kingfisher's engineers refused to work and did not put safety wedges on aircraft tyres after landing, media reports said.

In other cases passengers could not disembark some planes as step ladders were not attached.

Kingfisher has faced a series of strikes by pilots and engineers over delays in salaries, and has cut international and several domestic flights to curb costs.

The company was India's second-largest airline until a year ago but now has a market share of just 3.2 percent, the smallest of the country's carriers.

Owner Vijay Mallya, a billionaire liquor baron, last week said he was in talks with foreign airlines to sell a stake in the firm after the government relaxed foreign investment rules.

Also last week, local banks -- which own a quarter of Kingfisher -- rejected a request from the company for another loan.

Kingfisher has never made a profit since its creation in 2005 and is now at least $1.3 billion in debt. It has been hard hit by over-rapid expansion, intense competition and high fuel prices.


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