VISION “The Kingfisher Airlines family will consistentlydeliver a safe, value based and enjoyable travelexperience to all our guests.”Kingfisher Commenced its operations on May9,2005.Sanjay Agarwal is the current CEO of thecompanyKingfisherAirlines is also the sponsor of F1 racingoutfit, Force India
Top ManagementFinanc Marketin Operation e HR g s
31destinations in India 63 domestic destinations in Focused & Profit making India routes Many Unprofitable routes like Low price compared to King Nasik , Hubli etc. fisher red Grounding of 14 aircrafts Low Terminal cost like D1 in Strict rules by DGCA on New Delhi & 1 Bin Mumbai implementation of Time Table Multiple Hopping, leading to Focus on Low Cost Airlines cascading effect. Hence Innovative and radical ,delay of flight method so fair line back Operations shifted to New end operations like Terminals in Delhi & Mumbai. financing , leasing. Focus diverted from high Less Turnaround time as service to low cost compared to Kingfisher red More Turnaround time as compared to Indigo
Standardized Aircraft Less Inventory of Spares Less Training Cost Less Maintenance Cost Less Operational cost Effective Terminal Use Easy Scheduling Diversified Aircrafts with differentcapacities High Inventory of Spares High Training Cost High Maintenance Cost High Operational Cost Scheduling difficult More Human Resources required
WHAT WENT WRONG?Frankly, it was a hassle-free decision for Vijay Mallya to completelysuspend services on his budget carrier Kingfisher Red , says one ofhis close confidantes. Formerly known as Air Deccan, Mallya hadbought 26% stake in this airline from his friend-cum-neighbourCaptain Gopinath in 2007 at Rs 550 crore and later picked upadditional 20% stake at around Rs 155 a share. The intention of acquiring Deccan was only aimed at giving Kingfisher Airlines (KFA) an access to international routes quickly. Government rules gave overseas flight rights only to airlines with a minimum of five years experience, and KFA was behind in the queue after Deccan. “Mallya never believed in low fare business model even when he bought the airline,” says an official with the airline.
The dismal performance of Red all these years made Mallya realise thatthe high profile „classy image‟ of his very own KFA is taking a hit due tohim simultaneously running a low cost service.Meanwhile, discontinuing Kingfisher Red may have come as a surpriseto a few at a time when low fare carriers like Jet Lite, Indigo and SpiceJet are doing better then their full service peers in terms of load factors--- but the news has not sprung any surprise to analysts and KingfisherAirlines (KFA) officials who had guessed something of this sort was onits that case, an official at KFA explains, “A year ago, Mallya had metIn way.many brand consultants in Europe who had advised him to hive offKingfisher Red into a separate entity from its parent, KFA-- a move thatcould help the airline have an identity of its own just like JetLite--- a lowcost arm of its arch rival Jet Airways which is doing very well with almost90% load factors on domestic routes.But this idea did not see any daylight as the close coterie of Mallya hada better plan which was aimed at consolidating KFA‟s image as a „luxurycarrier‟ and reducing operating losses. Quickly, his battery of expertswent back to the drawing board, just recently, only to convince theirboss that Kingfisher Red has to go off the radar and Mallya agreed.
RECOMENDATIONS –MARKETING STRATEGY Holiday packages-at unprofitable routes • like Nasik, Aurangabad •Pricing-Should beat par with Spice jet and Indigo •Tie-ups with Corporate •Frequent flyer programmes •Better deals and offers for flyers in air
GENERALRECCOMMENDATIONS back1.Route rationalisation: Cutting unprofitable sectors and services to several cities2.Debt recast: Asking banks to reduce rates or take a cut on loans or find a local investor„3.Raising capital: It has plans to raise $200 million through GDR4.FDI: If the FDI limit is raised and foreign airlines are allowed to buy a stake, Mallya could recapitalise Kingfisher