India's troubled Kingfisher cuts flights
INDIA'S loss-making Kingfisher Airlines has cancelled as many as 32 flights a day, it said at the weekend, also admitting a glitch over tax payments in the latest signs of trouble for the carrier.
The company, which showed a third quarter loss of $88 million (£55m) last week, has been beset with difficulties caused by soaring fuel costs and high local sales taxes, as well as a domestic price war.
The airline admitted to the cancellations in a statement released late on Saturday (18) that blamed some of the disruptions on bird strikes. It said a full daily schedule of 240 flights should return to operation over the next week.
Kingfisher also confirmed its bank accounts were "attached by tax authorities", meaning payment of tax deducted at source had been queried by revenue officials.
"This has happened in the past. We have resolved issues before and will do so again," the firm said, dismissing concerns about its future as "media speculation".
Kingfisher, owned by colourful brewing magnate Vijay Mallya, has never posted a net profit since it started operating in 2005 and has seen its passenger market share slump in recent months to 12 per cent.
A quarter of Kingfisher is owned by local banks and some have refused to lend the company more cash unless fresh capital is raised.
Questions about Kingfisher's financial viability grew after it axed its low-cost Kingfisher Red service to concentrate on its full-fare business last September.
India's airline industry - once a symbol of the country's economic progress - is now plagued by high jet fuel prices, fierce competition, price wars and inadequate airport infrastructure, with Kingfisher one of the worst-hit firms.
Picture: Chairman and CEO of India's Kingfisher Airlines Vijay Mallya looks during a press conference in Mumbai on November 15, 2011.
No Comments Posted yet
Do you have comments on this?