Kingfisher to use own resources for revival
By ENS Economic Bureau - NEW DELHI
27th October 2012 10:15 AM
Chief Executive Officer of now grounded Kingfisher Airlines, Sanjay Aggarwal on Friday met Director General of Civil Aviation, Arun Mishra to apprise him about the revival plans of the airline.
Coming out after a 30-minute meeting with DGCA, Aggarwal said, “It was a general meeting to get a better understanding about presenting the revival plan of the airline. We will get back to them very soon.”
Aggarwal said the airline had not submitted a revival plan as yet but would do that soon. He also hinted that the airline would use its own resources to fund its revival.
“No time-frame has been specified,” the Kingfisher CEO said on being asked if DGCA had put a deadline for the submission of a revival plan. He also did not speak about when DGCA was planning to revoke the airlines’ suspended licence.
Sources within the airline said that the top management of the carrier will put their heads together from today to thrash out a revival plan soon. “This would include the number of aircraft they have, the routes they want to operate on, apart from financial issues including debt repayment,” the sources said adding they would have to submit a comprehensive plan on all these issues to convince DGCA to revoke suspension of their flying permit.
But resumption of Kingfisher’s flights may take at least 3-4 weeks as the airline would have to satisfy DGCA on safety issues as well as the viability of their financial and operational plans.
Regarding the proposed revival plan of the airline experts feel that the airline will face a lot of headwinds as any revival at this point in time would cost as much as $1 billion.
Kingfisher Airline’s licence was suspended by DGCA on October 20 as it failed to convince the aviation regulator with a credible revival plan and had also not ironed out issues regarding payment of overdue wages to its employees.
However, the airline on Thursday paid a part of the salaries to its employees after which they agreed to report back to work. The airline still owes about six month salaries to its employees.
Kingfisher employees have now resumed work after a 27-day strike and a 25-day lockout that was lifted by the management as it agreed to pay by December-end, four months salary dues to the employees in a staggered manner.
The striking employees had earlier stepped up the heat demanding an immediate settlement while threatening to take their protest to the upcoming Formula One Grand Prix in which airline promoter Vijay Mallya owns a substantial stake in Sahara Force India racing team.
The carrier, which had a fleet of 66 aircraft last year, now has 10 — seven airbus A-320s and three ATR turbo-props. It is saddled with a loss of Rs 8,000 crore and a debt burden of another over Rs 7,524 crore a large part of which has not been serviced since January.
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