New Delhi: In a call to arms, the man running operations at financially stressed Kingfisher Airlines Ltd, India’s biggest airline by passengers, has asked its 6,000-plus employees to adjust to delayed salaries and embarrassing dealings with unpaid vendors in the months ahead that will decide if the airline survives a severe downturn, even as chairman Vijay Mallya tries to secure funding for the carrier.
The communication comes at a time that airlines across the globe are faced with difficult times, and follows a similar missive from the office of Air India chairman and managing director Arvind Jadhav asking employees to join hands in a “fight for survival”.
Difficult times: Kingfisher Airlines has trimmed its fleet of 89 aircraft by 20. Harikrishna Katragadda / Mint
In an email sent late Saturday night, Hitesh Patel, executive vice-president, Kingfisher Airlines, wrote it was difficult to foresee what the future held for the carrier. But, “in a sense, our performance, our outlook over the next two months would dictate the shape of that battle,” he wrote, explaining how the airline was trying to improve its state of affairs.
An airline executive confirmed the receipt of the email, reviewed by Mint. Patel, who wrote the email after interactions with employees at four main bases for the airline, did not take calls for comment.
The era of “guests”, as Kingfisher Airlines calls its passengers, Patel said, was getting over with the growing market share of low-cost carriers (LCCs). “For the forseeable future, the market will be ruled by the LCCs,” Patel said, adding Kingfisher is following the trend and operating three of four of its flights as Kingfisher Red, its low-fare service.
The number of planes in Kingfisher Airlines’ fleet has been reduced to 69 from 89, added Patel, a former executive at JetBlue, a low-fare US airline.
“Along with all other airlines, we are in a tight situation regarding finances. You can expect to be in embarrassing situations with our vendors; your salaries may be delayed but never beyond the 7th,” Patel wrote, “Please remember, even as you read this mail, the chairman is out there, fighting a lonely and difficult battle to manage funds so that the salaries can be paid on time.”
Kingfisher Airlines, which flies one in four passengers in India, has been battling high losses for the past few years. Its debt is pegged at Rs8,000 crore, according to analysts, and oil minister Murli Deora told Parilament earlier this month that it owes Rs950 crore to state-run oil companies.
A person, who formerly served as a top executive at Kingfisher Airlines, said the mail “absolves the leadership of any blame” for the airline’s affairs.“To me, it’s just an excuse as to why salaries are being paid late,” this person, who didn’t want to be identified, said. “If you talk to employees, they are very upset. As an employee, you just want to know your money comes in the bank every month.”
Patel, however, sought to explain some of the tough measures. “If we are shutting some routes, it is to open newer ones. If we return a part of our fleet; it is to cap our operating costs,” he said. “Kingfisher Airlines is not in retreat.”