Tuesday , 22 September 2020

Kingfisher A320 planes de-registered or returned ?

The disagreement between Kingfisher Airlines and GE Commercial Aviation Services (GECAS) has become murky.

Yesterday, Daily News and Analysis (DNA) newspaper reported

“In a major setback to Kingfisher Airlines, the Directorate General of Civil Aviation (DGCA) has de-registered three of its aircraft on account of rental payment default. These aircraft will be grounded and not permitted to fly on commercial routes.

The airline had reportedly been erratic in paying its lease rental to GE Commercial Aviation Services (GECAS) for four A-320s. Kingfisher Airlines, however, denied a default and obtained a stay order from the Karnataka High Court to prevent repossession of the four aircraft by the firm in September this year.

Senior DGCA officials confirmed that three aircraft have been struck off the records on Thursday. “Three aircraft have been de-registered and one more is likely to meet the same fate next week,” said a senior civil ministry official on condition of anonymity.

The airlines has over a dozen A-320s flying on domestic routes. With a fleet of 50 aircraft, grounding four of them won’t impact the airlines much. But for Vijay Mallya, the DGCA’s action is no less than a bitter pill. De-registration of the aircraft means the airline will have to ground them with immediate effect. An airline spokesperson said: “This issue is sub judice and it will be inappropriate if I comment on the matter.”

This move comes as a big relief for the GECAS. The company is one of the world’s top aircraft lessors. Rattled by the payment defaults, it registered a complaint with the DGCA, asking for permission to repossess four aircraft leased to the airline. The company spokesperson, however, refused to divulge information: “GE treats its business discussions with high confidentiality and is unable to disclose any details.”

Today, as per Dow Jones newswire, Kingfisher Chairman Dr. Vijay Mallya, claims that Kingfisher has returned the Airbus A320 aircraft GECAS, and does not owe any money to GECAS, who is in-fact, withholding surplus Kingfisher funds.

While this makes interesting reading, I am left wondering, where have the business plans, of the super-successful business tycoon, Dr. Vijay Mallya, gone wrong.

Just last week the Business Standard reported that low cost carrier (LCC) IndiGo has overtaken Kingfisher Airlines to become the third largest carrier in India. It has also replaced Kingfisher Red (the former Air Deccan) as the largest LCC in India.

IndiGo gained two ranks to third position with a market share rose to 14.7 per cent, while Kingfisher Red remained at fourth with 13.3 per cent, and Kingfisher Airlines slipped two spots to fifth with a lowly 11.6 per cent. In October 2008, it was Kingfisher Airlines, Kingfisher Red, and Indigo in ranks three, four, and five, respectively.

Friends and acquaintances in the airline and aviation industry too are scratching their heads, at this sudden downturn at Kingfisher.

Kingfisher Airlines is a passion for Chairman Dr. Vijay Mallya, one he administers personally. Given his world-wide business interests, constant globe-trotting, and resultant demands on his time, is it time for Dr. Mallya to do a Naresh Goyal and let a veteran airline executive like Wolfgang Prock-Schauer step in as CEO, who can devote 24 x 7 and run the airline without interference ?

About Devesh Agarwal

A electronics and automotive product management, marketing and branding expert, he was awarded a silver medal at the Lockheed Martin innovation competition 2010. He is ranked 6th on Mashable's list of aviation pros on Twitter and in addition to Bangalore Aviation, he has contributed to leading publications like Aviation Week, Conde Nast Traveller India, The Economic Times, and The Mint (a Wall Street Journal content partner). He remains a frequent flier and shares the good, the bad, and the ugly about the Indian aviation industry without fear or favour.

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