Kingfisher Airlines Ceases Flights Due to Debt
The crisis for India's Kingfisher Airlines has reached a new extreme as a consortium of at least 14 banks have gone to a Karnataka court to try to recoup money they loaned to the airline.
As recently as 2010, Kingfisher was one of just six international airlines to receive the Skytrax five-star rating. When the airline first appeared in 2003 it was part of a generation of new carriers that were adding competitive energy to what had become a lethargic sector. India began deregulating airlines in the early 1990s offering increasing opportunities for private carriers to compete with state-owned Air India.
Jet Airways, Sahara and Kingfisher were the faces of a new Indian aviation industry. While Kingfisher's uncompromising emphasis on luxury and service improved aviation all over India the airline may have moved too fast for its own good.
"Kingfisher wanted to be an international carrier," said Supinder Singh, the president of New York-based Palace Tours, "but Indian regulations require at least five years in business before an airline can go international. Kingfisher's attempt to enter a low cost carrier also may have eroded their focus."
Kingfisher, once a member of oneworld, has been losing money at a prodigious rate, some Rs 755.17 crore in the fourth quarter of 2012. According to the Hindu Times, the 10 year-old airline has never enjoyed a profitable year. In March of 2012, IATA asked travel agents to stop booking the airline and Kingfisher employees began demanding the delayed payment of salaries. The airline has yet to officially declare bankruptcy, but it is no longer flying.
"Travel agents will avoid an airline that has as many question marks as Kingfisher does now, but it was carriers like Kingfisher that have created the environment we have today in India where there are many different option," says Singh.