Kingfisher grounds all flights until October 4

Passengers intending to fly with Indian airline Kingfisher over the coming days will have to revise their travel plans.

Employee unrest, a result of staff being unpaid for many months, has forced Kingfisher management to suspend all flight operations until next Thursday at the earliest.

The decision came shortly after Civil Aviation Minister Ajit Singh told the airline that it would not be allowed to operate if safety rules were not being observed.

Reports on livemint.com state that matters came to a head over the weekend when engineers at Delhi beat up a member of Kingfisher management and stranded passengers on one arriving aircraft by several hours when they refused to connect the airbridge linking the plane to the terminal.

According to The Times of India, industrial relations worsened today (Monday) when most of the carrier’s pilots and engineers, who have not been paid for six months, went on strike.

Today’s industrial action at Kingfisher has paralysed flight operations and forced management to temporarily close down the airline.

Ibnlive says that over 50 Kingfisher domestic flights were cancelled today. Heated exchanges took place between passengers and airline staff at several airports including Delhi, Mumbai and Chennai.

At one time, Kingfisher was operating an expanding network of international flights linking India with the UK and the Far East.  It was poised to join the Oneworld alliance.

But overexpansion, the rising cost of fuel and the economic downturn have forced Kingfisher to shrink its network and have lead to the carrier racking up hundreds of millions of pounds of debt.

For more information visit:  flykingfisher.com

Source: Business Traveller

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Kingfisher Airlines Cancels Flights Due to Labor Unrest

Cash-strapped Kingfisher Airlines Ltd. canceled several flights Monday as a section of its workers went on strike, causing the airline's stock to plunge by its daily limit of 5%.

Kingfisher didn't reveal how many flights were canceled but said that it expects more employees to join the strike because of threats from their colleagues.

Aviation Minister Ajit Singh told reporters that the airline didn't operate any flights until Monday evening. According to New Delhi airport's website and a Mumbai airport spokesman, Kingfisher has canceled all its flights to and from the two airports Monday.

"A section of employees of Kingfisher Airlines has not been reporting to work over the last fortnight and, over the past two days, they have been threatening and even manhandling employees who are reporting for work," the company said in a statement.

It didn't say why the employees are agitating, but the airline has been beset by financial problems resulting in late payment of salaries.

The strike came as Kingfisher's auditors said that although the company's financial results during April to June 2012 were prepared on a going concern basis -- an accounting term that refers to a company's ability to remain operational -- its net worth has been eroded.

They added that Kingfisher's ability to function will depend on whether it can "infuse requisite funds for meeting its obligations" and on "rescheduling of debt and resuming normal operations."

Last week, Kingfisher spokesman Prakash Mirpuri said the airline is flying only 15 of its fleet of 40 planes.

Kingfisher launched with much fanfare in May 2005 and soon announced aggressive expansion plans, which at the time included the only Indian order for the Airbus A380 superjumbo, and a takeover of leading Indian budget carrier Air Deccan.

But Kingfisher soon flew into trouble as the global economic crisis led to a fall in passenger traffic, while rising jet fuel prices increased costs.

Its cash reserves have been drained and the airline now owes millions of dollars to lenders, suppliers, aircraft leasing companies and in taxes to the Indian government. The airline still hasn't post a quarterly net profit in its seven years of existence.

Monday, a senior Kingfisher pilot said: "We haven't got salaries for months, and neither have the engineers and technicians. We are willing to talk to the management, but the engineers aren't," he said.

A second pilot added: "We won't join work until we get our salaries."

Shares of Kingfisher fell to 15.35 rupees ($0.3 cents) Monday in a Bombay Stock Exchange market that rose 0.3%. The fall is in sharp contrast to the stock's massive gains in mid- and late September after the Indian government announced a much-delayed decision to allow foreign airlines to buy stakes of up to 49% in local carriers.

The stock fell 69% in 2011 and a further 49% between Jan. 2 and Sept. 14 --the day India's government unveiled the foreign investment decision. Since then, the stock has surged about 42%.

Once India's second-biggest airline and now its smallest, Kingfisher posted a net loss of 6.51 billion rupees ($124 million) in the April-June 2012 quarter, compared with a loss of 2.64 billion rupees a year earlier.

Mr. Singh, the aviation minister, said India's airline regulator is looking into the cancellations and the absence of engineers to certify planes for flying.

"If the DGCA [Director General of Aviation] thinks the planes are not airworthy and that they are not certified by engineers, it [Kingfisher] won't be allowed to fly," he said.

Source: Wall Street Journal