Kingfisher set to fly with eight aircraft

Vijay Mallya

Vijay Mallya loves to do things in style. Whether it is cars, horses or high fashion, the 40-something chairman of UB Group has earned the right to be called the king of good times. But when it comes to business, Mallya is not averse to a model built around a low-end service.

The UB Group is all set to launch a low-cost carrier by the end of the current financial year. The airline will be called Kingfisher.

UB Group will be investing Rs 150 crore in the venture in the initial phase. "We have been working on the plan to launch the airline for some time now. It will start operations by the year-end," said Mallya, after meeting Civil Aviation Minister Praful Patel, to discuss the plans of the airline.

Interestingly, there is already a non-scheduled airline called UB Air in Mallya's stable, which operates one aircraft. According to government sources, Mallya has indicated that he would be seeking to convert the licence with UB Air into one for a scheduled airline. Mallya himself is a trained pilot.

The no-frill airline will have a fleet of eight aircraft in the beginning. The company will file its application for a licence to start the airline with the civil aviation ministry next week.

As per the initial plans of the group, the airline's fleet will consist of Airbus A-320s. "We are exploring other options for the later stages and have initiated talks with various aircraft manufacturers," he said. The aircraft will be partially taken on lease, while some will be acquired by the company.

The airline, to be based in Bangalore, will cover all the major metro and non-metro routes. "Though it will be a no-frill low-cost carrier, it will be a different experience. We will cover all the important routes," Mallya said.

According to sources, Mallya in his meeting with Patel, has sought clarifications about the guidelines pertaining to certain domestic aviation norms and demands by certain existing operators for entry barriers in the sector in terms of a higher equity base and foreign equity.

This will be the second low-cost domestic airline in the country, the first being the Bangalore-based Deccan Aviation, which started operations a year ago. Air India, too, recently unveiled its plans to start a low-cost international airline called Air India Express.

The whole of Asia, in the last year or so, has seen a rapid rise in the business of low-cost carriers. Aviation industry experts have predicted that low-cost carriers are best suited for a market like India, considering its size and demographic specifications.

They have also predicted that in the next 18 to 24 months, there will be at least four to five low-cost airlines operating in the country.