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Kingfisher Airlines had converted their capacity into low cost service Kingfisher Red

Kingfisher Airlines and Jet Airways have converted around half their capacity into low-cost service. This has contributed to begining down the average fares of airlines as a whole by about 30 per cent, from about Rs 4,000 in September last year to Rs 2,700 currently, a key reason why the domestic passenger market is looking up after months of decline

The number of low-cost seats in the system has increased by over 50 per cent this year compared with the same period last year, said Mohit Shrivastava, head of online sales at Makemytrip.com an online tickets and hotel booking portal.

Among the full service carriers, the government carrier Air India plans to launch a low-cost model in the domestic skies. Air India already has a low-cost airline called Air India Express which operates on international routes.

In Kingfisher Airlines, the number of low-cost seats in the system has increased by 50 per cent. The total number of low-cost seats available in Kingfisher Airlines has reached to around 70 per cent of the total. This figure was 45 per cent during the same period last year, said a source in Kingfisher Airline. Kingfisher Airline has converted some full services into LCCs, shifting these to Kingfisher Red earlier called Air Deccan, the country’s first LCC from Kingfisher Airlines the full service operations.

Trains, flights run behind schedule due to downpour

Passengers had a harrowing time as both trains and flights were cancelled or diverted because of bad weather conditions in the state and neighbouring Karnataka. Many flights, which took off from Mumbai airport, had to take a U-turn and return as the runway got flooded and the airport was declared shut.

Several passengers were stranded at the Dabolim airport for over five hours as 28 flights were affected due to the Navy declaring the runway unfit for use because of flooding.

Officials said that the airport was closed from 1pm to 6pm, though the Navy declared the runway unfit for use only by 4 pm. In the morning, five flights arrived in Goa. However, the problem started after 1pm.

While 13 flights were expected to arrive in Goa, they had to be either cancelled or diverted due to the bad weather. Most of the flights were from Mumbai, Pune, Bangalore and Delhi. About four incoming Kingfisher Red flights, two Spicejet, three Jet Airways, one Jetlite, two Indigo, one Indian airlines and one Go Air were affected.

While domestic flights and passengers suffered, major relief came after one international flight landed at Dabolim airport at 5:30 pm coming from Kuwait via Chennai. The second international flight from Dubai via Bombay was diverted to Bombay airport.

Several trains on the Konkan Railway route were cancelled, while some were rescheduled or diverted on account of railway tracks going under water in areas between Canacona and Karwar and north Karnataka regions.

Both up and down Matsyagandha Express trains Mangalore Lokmanya Tilak Terminus, Trivandrum bound Netravati Express departing from Lokmanya Tilak terminus, Mumbai and Garib Rath Express train, were cancelled, while Trivandrum-Nizamuddin Rajdhani Express was running indefinite late.

While the Mangalore-Verna passenger train had to be halted at Ankola, the Mumbai Ernakulam Mangala Express has been diverted through an alternate route, senior public relations manager, Konkan Railway, Baban Ghatge informed. The Margao Karwar passenger train scheduled for departure on Saturday morning also stands cancelled, Ghatge told TOI

Kingfisher Airlines asked to return parts leased from Lufthansa

The Delhi High court has directed Kingfisher Airlines to return all components leased out to it by Lufthansa Technik India following a petition by the latter that the carrier was using them even after it breached an obligation to make timely payments.

A single member bench of Justice S N Dhingra directed Kingfisher Airlines to make an inventory of all components leased out to it by Lufthansa Technik while receiving technical support for its fleet.

An inventory of the home based components, those used in maintenance, overhaul and repair leased out by Lufthansa Technik to Kingfisher Airlines under the agreement in question be prepared, Justice Dhingra said while passing an interim order.

In its petition Lufthansa Technik said Kingfisher Airlines terminated the agreement on August 18.

Lufthansa Technik India also alleged that Kingfisher Airlines breached its obligation to make timely payment to it as per terms and agreement.

According to the company, Kingfisher Airlines has not paid dues of Rs 17.7 crore for the months of July, August and September this year despite enjoying technical support.

Kingfisher Airlines after preparation of the inventory shall hand over all those components, which are under the lease and are intended to hand over by it, the court added while appointing a retired judge to make inventory.

The court also issued notice to Kingfisher Airlines and directed it to file a reply over the allegations made by Lufthansa Technik, while ordering the carrier to bring all components to Bangalore and Mumbai.

The court has directed to list the matter on October 29 for next hearing.

Lufthansa Technik is the world’s leading provider for maintenance, repair and overhaul of airplanes, components and engines. It had entered into an agreement with Kingfisher Airlines in March 2005 for undertaking maintenance, repair and overhaul activities for ten years.

Kingfisher Red to fly to Bangkok from August

Kingfisher Airlines Ltd plans to start is first flight to South-East Asia in August with the low-fare Kingfisher Red service to tap into the peak winter tourist traffic in the region after September.

The Kingfisher Red flight, which will not offer any business class seats, will fly daily between Kolkata and Bangkok starting 14 August on an Airbus SAS-made A320 aircraft, according to the carrier’s website.

It will be the airline’s fifth low-cost international service. The carrier recently launched a Kingfisher Red service between Bangalore and Dubai, and has daily flights from Bangalore and Chennai to Colombo as also from Kolkata to Dhaka.

If you look at this region, Bangkok and Kuala Lumpur are rising very fast and tour operators are pushing these sectors hard, said Aloke Bajpai, New Delhi-based chief executive officer of Le Travenues Technology Pvt. Ltd-run travel website iXiGO.com. For several first-time international travellers from tier-II cities, these places are ideal budget choices.

On the Kolkata-Bangkok route, the Kingfisher Red service will have to compete with three direct daily flights including ones by National Aviation Co. of India Ltd-run Air India, Jet Airways India Ltd and Thai Airways, which could lead to cheaper fares on this sector.

Given this low level of competition, Bajpai said the new route lasting under three hours, will be easier to break even compared with flights of similar duration on domestic sectors.

A Delhi-Bangalore route, with the same flying time, has over 20 daily flights.

Still, the break-even will depend on passenger numbers on the new route.

On Thursday, Jet Airways announced it will launch its second daily service to Bangkok from Mumbai starting 16 August.
The airline operates a daily service to Bangkok from Mumbai, as well as from Delhi and Kolkata.
Bangkok airfares

Indigo Partners evinces interest in Kingfisher Airlines

Kingfisher Airlines, which is actively looking for an equity infusion, is said to have received an expression of interest from Indigo Partners, a US-based airline investor.

According to sources close to the development, Indigo Partners has submitted a term sheet to Kingfisher Airlines. The term sheet is said to have come with certain conditions, which airline owner Vijay Mallya may have to abide by if he wants Indigo’s support.

Indigo is a global aviation investor, and is one of the key investors on board of Singapore Airline’s low-cost airline Tiger Airways. Indigo has also invested in numerous airlines based in Russia and Europe.

Sources in Mallya’s UB Group said that while Kingfisher has received a term sheet from Indigo, it has not yet executed on that. Indigo is said to have asked for a detailed statement on the financial health of the loss-making carrier. The investors are also believed to have laid down a clause seeking a joint committee to whom the CEO and CFO of the company would report to. That means Kingfisher would have to appoint a full-time CEO to run the operations. Currently, Mallya is at the helm of the airline company with various operational heads running the show.

Sources say that the talks with Indigo have not progressed much beyond getting the term sheet, as Mallya is still pondering the clauses.

Kingfisher currently is negotiating with nationalized banks including State Bank of India, Punjab National Bank, Bank of India and Bank of Baroda to raise a debt of Rs 2,000 crore. Mallya has said in the past that he is looking at an equity dilution at the entity level amounting to Rs 2,000 crore. Kingfisher Airline’s market capitalization calculated on the company’s current share value stands at Rs 1,547 crore.

Mallya had also been lobbying for foreign direct investment in the aviation space, which would allow international carriers to hold equity stake in Indian carriers. Recently, there was speculation over Southeast Asian giant, Singapore Airlines, looking to pick up a stake in Kingfisher.

Airlines portals offer up to 50 percent cash refund on ticket

In an attempt to bring back travellers and increase passenger load factor, domestic airlines and travel portals have come together to offer discounts and cash back of up to 50 percent on a ticket.

Gurgaon-based low-cost carrier, SpiceJet, is offering up to 50 percent cash back on its basic fare through travel portal, makemytrip.com, for sectors where the distance is less than 750 km and 25 percent in case of sectors where the distance is more than 750 km. The amount will be credited within a week after the date of travel. This offer is valid till the end of March.

As a result, it is now possible to get a ticket on the Mumbai-Delhi route for Rs 3,465 all inclusive through cash-back schemes if booked 30 days in advance.

Spicejet chief executive officer Sanjay Aggarwal told ET, These are promotional offers that depend on routes and load factor. We have no plans to cut airfares in the current scenario. Kingfisher Airlines, too, is offering 10 percent cash back of up to a maximum of Rs 200 per transaction. This can be availed only when one books a ticket on a domestic route through yatra.com. Likewise, there is a 50 percent cash back on GoAir when booked through cleartrip.com.

Given that airlines are facing load factors that are low, cash back offers and discounts are short-term tactics to fulfil the advance booking targets, said an analyst with a domestic brokerage firm. Importantly, just 33.2 lakh passengers flew in January this year against 38.9 lakh in January 2008 – a decline of 14.6 percent.

Airlines cannot cut airfares further at a time like this. These offers and discounts are only for a limited period, iXiGO.com, a travel portal, CEO Aloke Bajpai said. Earlier this month, airfares had increased by Rs 2,000 per ticket, after the promotional offers were withdrawn. Just after that, a Mumbai-Delhi ticket would cost anywhere between Rs 5,000 and Rs 6,000. A day later, airlines like JetLite, GoAir brought back their promotional offers.

Kingfisher Red pips JetLite in terms of number of passengers

Kingfisher Airlines and its low-cost Kingfisher Red together stole a march over Jet Airways-JetLite, by carrying the highest number of passengers in January, even though the total passenger traffic recorded a marginal increase since December.

The total number of passengers carried by domestic carriers rose from 33.23 lakh in December to 33.26 lakh last month, official figures released today said.

Kingfisher Airlines and its subsidiary kingfisher Red, former Air Deccan, carried 9.19 lakh passengers in January, beating Jet Airways-JetLite which together flew 8.37 passengers last month.

Air India Express carried 5.55 lakh passengers on its domestic route network, the statistics showed. Till December last year, JetLite has been leading the Indian airlines in terms of the number of passengers carried.

Among the low-cost carriers, IndiGo led the way by flying 4.57 lakh air travellers, followed by SpiceJet with 3.93 lakh, JetLite 2.1 lakh and the remaining less than one lakh each.

As with the actual numbers of passengers carried, Kingfisher Red led by the percentage share among the carriers with 27.6 per cent, followed by 17.9 by JetLite and 16.7 by Air India Express

Airlines may hit by Rail fare cut

With the railway minister, Mr Lalu Prasad, announcing two per cent cut in passenger fares for all classes including air-conditioned, the number of passengers travelling by air could be further hit.

As all domestic airlines, including low-cost ones, had recently hiked their fares and they remain too expensive for close to one year now, the cut in railway fares has further widened the cost difference between the two modes of transportation.

Leave aside full service carriers like Air India, Jetlite, Kingfisher Red, Jet Airways and Kingfisher Airlines, even low-cost carrier – LCCs fares are now at least double the AC-II train fares. While Rajdhani’s AC-II fare for a journey between Delhi and Mumbai costs about Rs 1800, the minimum LCCs fares for the same start at Rs 4800. This is the case on most routes and LCCs fares remain double the fares for AC II class.
This is despite the fact that when LCCs carriers like Air Deccan started their services in the country in 2003, they had expected to lure AC class train passengers to air travel as fares for the two were almost the same.

The situation has worsened with passengers departing from three of the four busiest airports, Bangalore, Hyderabad and Delhi in the country being made to pay additional development fee of up to Rs 375. SNS

Kingfisher Red special fare of Rs 883 on Mumbai-Nashik route

Kingfisher Red Airlines, Private air-carrier on Wednesday announced an all-inclusive special fare of Rs 883 on its Mumbai-Nashik flight.

Kingfisher Red Airlines offers all inclusive fares at Rs 883 for Mumbai-Nashik and Rs 885 for Nashik-Mumbai.

The passengers can avail the offer by booking their tickets in advance, the release said.

The Kingfisher Red, the low-cost arm of Kingfisher Airlines, operates a daily direct service between Mumbai and Nashik, with flight from Mumbai for Nashik leaving at 5.50 am and arriving in Nashik at 6.40 am. The return flight leaves Nashik at 4.30 pm and arrives in Mumbai at 5.20 pm, the release said