Cash-strapped Kingfisher cuts flights
Vijay Mallya-led Kingfisher Airlines on Tuesday cancelled 34 flights across various sectors, increasing the risk of upsetting passengers’ travel plans ahead of the peak winter season as the country’s second-largest airline struggled to find funds even for basic needs such as jet fuel. HT reports.india Updated: Nov 09, 2011 01:40 IST
Vijay Mallya-led Kingfisher Airlines (KFA) on Tuesday cancelled 34 flights across various sectors, increasing the risk of upsetting passengers’ travel plans ahead of the peak winter season as the country’s second-largest airline struggled to find funds even for basic needs such as jet fuel.
Eight daily flights between Delhi and Mumbai, four flights between Bangalore and Mumbai, two daily flights each between the Mumbai-Hyderabad and Delhi-Bangalore routes were among those that were cancelled.
“KFA has reduced frequency on some of its flights, which are predominantly over weekends or on some routes where there has been slow demand. For a limited period, these flights are either being cancelled or clubbed with other KFA flights in a well-controlled, pre-determined manner,” the airline, which is battling mounting debts, said in a statement.
The capital-starved airline, which hasn't ever made profits since its inception in 2005, had a debt of R7,057.08 crore as on March 31, 2011 and reported a loss of R1,027 crore for 2010-11.
It has been defaulting on payments to oil companies and airports, and had delayed salaries to its employees in recent months.
Sources, however, said that about 10% of its flights could get affected in the coming days and weeks.
At present, KFA operates 350 daily flights in India and overseas locations. "These may affect even international operations including the Delhi-Bangkok sector," said the top executive of a travel portal requesting not to be named.
KFA has reduced its fleet size from 89 to 66 aircraft over the last 2-3 years.
Not just that. More than 75 pilots have quit the airline in the last three months.
The capital-starved airline, which hasn't made a profit since its inception in 2005, last month announced that it would close down its low-fare segment-Kinghfisher Red-within four months.
KFA implemented a debt recast package earlier this year after which loans from bankers of R1,300 crore and funds from promoters of approximately R745 crore were converted into share capital.
The consortium of banks now owns 23% equity in the airline.