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Vayalar Ravi rules out public bailout to salvage crisis-ridden Kingfisher Airline

18 Nov 2011 Evaluate

Civil aviation minister Vayalar Ravi ruled out a public bailout to salvage crisis-ridden Kingfisher Airline or any other airline, urging private airlines in India to put their own house in order. Ravi said ‘it is for the private airlines to manage their finance and other affairs and the government cannot do anything for a particular company because the aviation industry as a whole is facing a crisis.’

Reports also stated that the government is also likely to allow up to 26% equity participation by foreign airlines in Indian carriers, a move that could throw a lifeline to Kingfisher and its struggling rivals such as Jet Airways and SpiceJet.

Cash-strapped Kingfisher Airlines, the country's No.2 air carrier by market share, saw its quarterly loss double and cancelled scores of its flights this week. It is reported that after cancelling 50 flights every day till November 19, the country’s second-largest carrier Kingfisher Airlines indicating to government that it is looking at curtailing 200 flights from its daily winter schedule of 418 domestic flights.

Moreover, around 130 pilots have already quit the cash-strapped carrier in the past few weeks. Also, airport operators, oil companies and vendors of all imaginable items have massive dues running with Kingfisher and are demanding that owner Vijay Mallya to pay up. Given the shortage of crew and funds, the airline has truncated its schedule, perhaps opting to fly less and spend less.

Peers
Company Name CMP
Interglobe Aviation 4638.75
SpiceJet 13.88
Raymond 422.05
Global Vectra Helico 203.85
Taneja Aerospace 281.55
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