Reported in the Economic Times (www.economictimes.indiatimmes.com) today .
I think the "full service value carrier" positioning makes sense. The Kingfisher brand already has a lot of brand recall (for the beer) and having tagged on the name to the airline, The promoters cannot afford to go low cost. And in this regard a 10 channel audio and PTV on each seat helps (I think it can be safely assumed that the airline would have got a good discounnt on these from the IFE providers who will also be wanting to cash in on the burgeoning Indian market). And you should remember that the shortest sector in the three routes they are initially launching is 90 min while BLR DEL goes upto 150 min.
But more than that I feel Kingfisher is on the right track because of a number of other reasons.
1 Unlike Air Deccan Kingfisher is targeting business travellers straightaway. As per the route plan announced, the 1st aircraft is to operate thrice daily BOM BLR, the 2nd one thrice daily DEL BLR and the third one will do BOM DEL. This will mean that the business travellers will have a day return facilty which is crucial to them. Air Deccan when they launched their A320s routes straightaway concentrated on expanding their network instead of building up frequencies. THe 2nd daily flights on their major A320 routes started many months after their A320 launch ( and when their 4th and 5th aircraft came on line). Even now their BOM DEL or BLR BOM frequencies are more or less useless to business travellers in terms of timings.
2 Outsourcing groundhandling and engineering to Indian Airlines. Smart move this. Well established setup for IC
in these stations which Kingfisher can utilise and the deal is sweet for IC
too at the price I guess ( Ra 100 crore is what is reported).
3 Buying out ICs surplus capacity in Cat II
and Cat III routes.. This I think is the smartest move of the lot. You take care of the social obligation part and for Indian Airlines also the deal is sweet. And also it helps Kingfisher avoid these revenue draining 3 days a week flights to unviable stations obligated by the CAT II
/CAT III rules .
The pricing also looks sound. Three price buckets and with even the lowest one at a sensible level, the revenue dilution will be much lower.
The full article is here