gauravpai From , joined Dec 1969, posts, RR: Posted (2 years 8 months 2 weeks 2 days 23 hours ago) and read 26196 times:
Will the drama finally end effectively closing down the airline.?
Aviation regulator Directorate General of Civil Aviation (DGCA) may suspend the licence of Kingfisher Airlines today for failing to come up with a viable financial revival plan, sources have said.
The Vijay Mallya-promoted airline was to respond to a show-cause notice issued by the regulator by today (October 20), but that seems unlikely as the airline has sent out a request for more time to do so.
The DGCA will consider all legal implications before suspending the licence, the sources said. It had asked the airline, which has not operated a single flight since 1 October, to explain why its licence should not be cancelled.
In a statement issued on Friday, the debt-laden airline said it had written to the aviation regulator seeking time on the show-cause notice, and added that it was extending its partial lockout until October 23. In a second extension (the first being until 12 October), the lockout is scheduled to have today (October 20).
"The management hopes to resume operations on November 6," Friday’s statement added.
The airline was forced to declare a lockout and suspend flight operations after its 250 engineers went on strike on September 30.
They were later joined by pilots.
The employees are protesting against non-payment of salaries and dues, and have said that work will resume only after all dues are paid and assurances are given that salaries will be paid on time.
Several talks between the staff and the management have failed.
On Friday, Kingfisher statement quoted Prakash Mirpuri, the vice-president of corporate communications, as saying, “We had a positive meeting with employee representatives on October 17 and are hopeful of reaching common ground when we meet again next week."
Shares in Kingfisher Airlines dropped 4.8 per cent on Friday ahead of the October 20 deadline to respond to the civil aviation authorities. The DGCA had told the airline on October 5 to demonstrate why its permit to fly should not be suspended or cancelled for failing to establish a "safe, efficient and reliable service", and gave it 15 days to reply.
Kingfisher had previously grounded flights until October 20, but the industry regulator on Wednesday had rejected Kingfisher's winter schedule.
The airline currently has only 10 operational aircraft compared to 66 planes a year ago.
The Vijay Mallya-owned airline is reeling from a $1.4 billion (Rs. 7,524 crore) debt. It has accumulated operating losses of Rs. 8,000 crore.
Lenders to the airline earlier this month agreed to release Rs 60 crore from an escrow account to keep the airline afloat. An escrow account, which prevents a default in loan obligations by a company, ensures that funds received by a company cannot be accessed by it but goes directly to the lenders.
After the restructuring of loans to Kingfisher Airlines in 2010-11, its lenders had taken charge of cash flows, including funds received through ticket sales. The airline needs Rs 55 to 60 crore to pay salaries for two months.
So far, the meetings between the management and the striking employees have failed to end the impasse. A crucial meeting on Thursday also could not arrive at a conclusion. The management has assured payment of a month’s salary which is not acceptable to the staff.
ZKOJH From China, joined Sep 2004, 1782 posts, RR: 1
Reply 6, posted (2 years 8 months 2 weeks 2 days 20 hours ago) and read 25530 times:
Well they seem to keep finding some extra breathing space!
''Mumbai, October 19, 2012
Kingfisher Airlines Ltd. has extended the partial lockout until October 23, 2012. We had a positive meeting with employee representatives on October 17th and are hopeful of reaching common ground when we meet again next week. Currently, we anticipate resuming operations on November 6th, subject to our resumption plan being reviewed and approved by the DGCA.''
blueflyer From Northern Mariana Islands, joined Jan 2006, 4531 posts, RR: 3
Reply 8, posted (2 years 8 months 2 weeks 2 days 18 hours ago) and read 25125 times:
Quoting ZKOJH (Reply 6): Well they seem to keep finding some extra breathing space!
That doesn't change anything.
The DGCA has given Kingfisher until October 20 to explain why its license shouldn't be withdrawn. This deadline is in no way influenced by the airline's unilateral and unrelated decision to extend its employees lockout until October 23.
The first step of their resumption plan Kingfisher mentions in its press release is to get the DGCA to give them more time to file their answer and avoid losing their license. If the DGCA grants their request, they get to keep on dying slowly for a while longer. If the DGCA doesn't, their long and slow agony ends today...
RWA380 From United States of America, joined Feb 2005, 3954 posts, RR: 5
Reply 12, posted (2 years 8 months 2 weeks 2 days 16 hours ago) and read 24007 times:
I've been wondering how many times this carrier can come so close to flat lining, until they do it for good. Kingfisher has been given the paddles more than once to revive them for short spurts, but they always seem to end up stuck in quick sand.
This is sad for all involved, the guy who lost millions and millions investing in this airline, the employees that have little job security, the debtors who will likely not see their money, nor the travellers (not sure how many) whose plans are going to be interrupted or fubarred in some way. The economy of support services that Kingfisher at least in part supported. RIP IT
AA AC AQ AS BD BN CO CS DL EA EZ HA HP KL KN MP MW NK NW OO OZ PA PS QX RC RH RW SA TG TW UA US VS WA WC WN
gauravpai From , joined Dec 1969, posts, RR:
Reply 14, posted (2 years 8 months 2 weeks 2 days 15 hours ago) and read 23230 times:
Quoting RWA380 (Reply 12): This is sad for all involved, the guy who lost millions and millions investing in this airline, the employees that have little job security, the debtors who will likely not see their money
Quoting Cricket (Reply 13): RIP Kingfisher, I guess as a holder of 70,000 King Miles I'm also an unsecured creditor now...
57000 miles myself so am in it with you
anyways was fun as long as the goodtimes lasted,will miss the lobster meals,the freshly brewed coffees ,the personalised specatcle cleaning, the amenity kit and ofcourse the Personally picked IT stewardesses.
HPRamper From United States of America, joined May 2005, 4629 posts, RR: 7
Reply 17, posted (2 years 8 months 2 weeks 2 days 14 hours ago) and read 22766 times:
They should be forced to sell their aircraft off and all proceeds given to the employees who have been literally working for free for half a year. Shameful that this airline was allowed to operate off the backs of free labor for so long based simply on empty promises by management. It boggles my mind how this could even happen in this day and age.
art From United Kingdom, joined Feb 2005, 3482 posts, RR: 1
Reply 18, posted (2 years 8 months 2 weeks 2 days 14 hours ago) and read 22710 times:
IMO the board members responsible for this mess should be disbarred from holding such office in Indian companies. If found to have acted illegally, they should be punished and made personally responsible for any debt arising from their illegal conduct.
I find it disgusting that while failing to pay salaries the company stopped processing "requests for references" which would have enabled employees to secure an income stream elsewhere. I would like to see those responsible for that imprisoned to send out a message to other unscrupulous employers.
BLRAviation From India, joined Feb 2009, 477 posts, RR: 14
Reply 20, posted (2 years 8 months 2 weeks 2 days 13 hours ago) and read 22069 times:
Quoting LOWS (Reply 19): Will that be the technology developed by Zero Halliburton?
Quoting LOWS (Reply 19): Will employees have any claim for assets for their back wages?
Indian law is very favourable to labour, but unfortunately most of IT employees will be on a pay scale above labour i.e. factory workers, and there the employees will have to just get in line like unsecured creditors.
But in all our head shaking, we are overlooking the political angle in all of this. DGCA has given Mallya the "Get out of Jail Free" card.
By suspending the license, Mallya can conveniently duck and dump the whole problem in the lap of the government.
"I was trying to revive, get FDI, do this, do that, GoI closed the airline. Now how can they expect me to repay the debts [to employees, government oil cos., airports, etc. etc. etc.]".
As a seasoned media professional in the thick of things, I would love to hear Cricket's views on my hypothesis.
Cricket From India, joined Aug 2005, 2984 posts, RR: 7
Reply 22, posted (2 years 8 months 2 weeks 2 days 9 hours ago) and read 18992 times:
Quoting HPRamper (Reply 17): They should be forced to sell their aircraft off and all proceeds given to the employees who have been literally working for free for half a year. Shameful that this airline was allowed to operate off the backs of free labor for so long based simply on empty promises by management. It boggles my mind how this could even happen in this day and age.
Sell what aircraft? They don't own a single one, in fact the lessors are having to pay off the airports just to get them out and worse, many of them (those parked up at T2 at DEL) are simply unflyable; which given that they are in some cases just four years old is goddamn tragic...