Kingfisher Airlines chairman Vijay Mallya met civil aviation minister Ajit Singh on Wednesday and was believed to have discussed the embattled airline’s problems.
The 45-minute meeting took place a day after Mallya met director general of civil aviation (DGCA) E K Bharat Bhushan and announced a drastic cut in the flight schedule and closure of international operations.
Bhushan, who had earlier sent a show-cause notice to Kingfisher, is yet to give his report to the government.
The airline maintains a difficult operating environment and a freeze on its bank accounts by the income tax and service tax departments hamper its revival and it is working to address these problems.
Both Singh and Mallya did not speak to the media after their meeting. However, it is understood Mallya briefed Singh about the airline’s financial and operational status.
Though Singh has been saying cancellation of flying permit of any airline would be injurious to the health of the industry, he has made it clear this could be done, if flight safety was compromised in the name of cash crunch.
“We are waiting for the DGCA report on Kingfisher Airlines,” Singh told reporters, adding the government would not defend the airline, if legal action was taken or required against it.
Kingfisher yesterday gave a new flight schedule to the DGCA and said it would operate 110-120 daily flights with 20 planes during its summer schedule. This was the third time Kingfisher gave a truncated schedule to the aviation regulator.
However, the new plan could not impress the DGCA. “Kingfisher is severely hamstrung for want of funds and we still do not have any clarity whether the airline will be able to defray its liabilities. We have no assurance on that,” Bhushan had said yesterday after a meeting with Mallya.
The airline, which made a loss of Rs 1,027 crore in 2010-11 and Rs 1,175 crore in the first three quarters of this financial year, has accumulated losses of Rs 6,000 crore. It has Rs 7,000 crore in debt on its books.
Singh yesterday put the onus on Mallya to maintain the airline’s operations and adhere to the schedule. “Kingfisher has been curtailing a lot of flights.
It started the winter schedule with 68 planes and over 400 flights and now, has shrunk to below 20 aircraft and a little over 100 flights. It has revised its schedule two-three times, but has failed to adhere to it,” Singh had said.
| KINGFISHER AIRLINES WHAT IT SAID & WHAT IT DELIVERED Ever since Kingfisher Airlines flew into a crisis, its flamboyant owner & CMD Vijay Mallya has been trying to reassure stakeholders that things will be fine soon. Here’s a realty check on what the airline said over the last four months and what it delivered | ||
| What Kingfisher Airlines said | Status | |
| Nov 2011 | Curtailment of flights due to reconfiguration process Changes in the flight schedule only till March Our unreserved exposure (vis-a-vis oil companies) now is not even 10% | New summer schedule has only 20 aircraft Disruptions continue Still owes over Rs 600 crore to oil cos |
| Dec 2011 | To be a part of Oneworld Alliance by February 10, 2012 | Oneworld Alliance puts airline on hold in January |
| Feb 2012 | Current disruption of flights due to attachment of our bank accounts by the I-T department Airline blames the disruptions on bird strikes In talks with tax authorities to get our bank accounts unfrozen Salaries to be paid and grounded aircraft recovered once the bank accounts are unfrozen | Accounts remain frozen; few were unfrozen briefly Flight disruptions continue Accounts remain frozen; airline in talks with tax department Aircraft are still grounded and salaries not paid for the last four months |
| Mar 2012 | Flight disruptions because of pilots not reporting to duty Second-time suspension from IATA Clearing House added to the problem | Some pilots report to duty after meeting Vijay Mallya; not many flights to fly though Still remains suspended from IATA Clearing House |
| Compiled by Mihir Mishra & Aneesh Phadnis | ||
“We are not a giving last or first chance to Mallya. He has to decide whether to run the airline or to how to run the airline. DGCA is looking after the situation. To continue to have the licence, they have to have five aircraft, but at present, the financial situation is bad,” he had said.
