New Delhi:
Is Kingfisher Airlines going the Air India way? The airline cancelled more flights today and its stocks plunged to a lifetime low.
Here issued a statement today clarifying its position:
- The airline industry in India is going through a tough period due to high costs and lower yields. This is evident by the unprecedented losses recently reported. To counter these pressures and leveraging its strengths, Kingfisher decided to rationalise network, drop unprofitable flights and expedite its fleet reconfiguration. This initiative will improve the long term profitability of the airline.
- The reconfiguration initiative will require up to 3 aircraft to be out of service over the next three months at any one time for this exercise to be completed. It will reduce the number of fleet configurations from 7 to 3, improving operational flexibility. This initiative will add more seats to the fleet, improving revenue production of each aircraft.
- The actions over the last few weeks have been to implement the above strategy in a pre-determined and well-controlled fashion.
- Kingfisher Airlines has rationalised its network to offer maximum and seamless connectivity. As per the revised schedule, it will offer 300 daily flights connecting 54 cities as compared to its previous schedule of 340 flights. The revised schedule is being loaded in the system and guests can confidently continue booking Kingfisher flights.
- Our guests remain our top priority. We reached out to all our guests who were booked on these cancelled flights to re-accommodate them either on our or other airline flights. We offered full refund to those who so desired. We apologize to the guests who might have been inconvenienced.
- No Kingfisher flights have been canceled due to lack of pilots or other staff. The attrition of 100 pilots did not happen overnight. Kingfisher has sufficient number of pilots and a robust pipeline of new pilots to continue to operate its scheduled flights.
- The CAR140 requires DGCA to be informed if there are flight cancellations for a longer period of time. While we were finalizing the plans, we only announced these cancellations until November 19th.We did not feel the need for informing DGCA. In hindsight, we should have informed them and we apologized to them for the same.
- Kingfisher has credit terms or payment arrangements with all its vendors which we are complying with.
- Kingfisher has not made any bail out request to the government. We have only asked our banks for an increase in limits due to significant increase in operating costs caused by increase in fuel prices and rupee devaluation.
- There has been a few days delay for the last 2-3 months in payment of employee salaries. However, all employees have been paid in the month the salaries were due.
- Kingfisher does not see any risk to its future or long term viability. The whole Indian Aviation Industry is struggling due to high costs and lower yields. We are no exception. Like any other prudent business we are taking steps to improve our financial performance.