India freezes Kingfisher Airlines’ licence
NEW DELHI: India has suspended Kingfisher Airlines Ltd’s operating licence after the cash-strapped carrier failed to resume flights because of a strike by engineers and pilots demanding seven months of unpaid salaries.
The suspension would remain in effect until the airline submitted a “concrete and reliable” revival plan to the director-general of Civil Aviation, the industry regulator, the Civil Aviation Ministry said in a statement.
Bangalore-based Kingfisher said in response that it was halting all reservations until it could restore flights.
The regulator’s move adds pressure on Kingfisher chairman Vijay Mallya as he seeks investments for his airline, which is struggling with 86 billion rupees (US$1.6bil) of debt after five consecutive years of losses.
The carrier extended its flight shutdown, which started on Oct 1, for a third time on Oct 19. The regulator has denied approval of Kingfisher’s winter schedule amid the disruptions.
The license suspension “will allow Kingfisher time to rethink about complete revival or assess damages due to possible closure rather than restarting a five-aircraft operation,” Kapil Kaul, head of the CAPA Centre for Aviation consulting company in India, said in an e-mail.
A revival would be dependent on the founders raising a minimum of US$600mil, which was highly unlikely, he said.
Kingfisher failed to address any of the issues raised by the regulator in a notice on Oct 2, the ministry said. The carrier hadn’t indicated when it would submit a detailed operational-preparedness plan, and the regulator couldn’t grant its request for more time to file a reply, it said. — Bloomberg