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Kingfisher Airlines defers A380s purchase by 2 years

Kingfisher Airlines defers A380s purchase by 2 years
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First Published: Wed, Feb 04 2009. 10 54 PM IST

Rationalizing capacity: A Kingfisher Airlines aircraft. The firm had placed orders for five A380 aircraft with France’s Airbus in 2005. Ramesh Pathania / Mint
Rationalizing capacity: A Kingfisher Airlines aircraft. The firm had placed orders for five A380 aircraft with France’s Airbus in 2005. Ramesh Pathania / Mint
Updated: Wed, Feb 04 2009. 10 54 PM IST
Mumbai: India’s second largest private carrier, Kingfisher Airlines Ltd, has deferred its purchase of five A380 aircraft, the world’s largest, by two years as it has sought to lower operating costs for the plane, according to two executives with the carrier.
A Kingfisher executive, who refused to be identified, said the airline has requested Airbus SAS to modify certain specifications for the A380s it has ordered so as “to increase fuel and operational efficiency”.
Rationalizing capacity: A Kingfisher Airlines aircraft. The firm had placed orders for five A380 aircraft with France’s Airbus in 2005. Ramesh Pathania / Mint
“Kingfisher Airlines is looking at A380s with a lower weight to fly non-stop between India and the US. This may delay our A380 acquisition programme by about a year,” the executive said. “But we have not heard from Airbus yet.”
The airline is still keen on the A380s and does not plan to cancel its orders, he added.
A Kingfisher spokesperson confirmed the delays.
The delivery of the aircraft is deferred from 2012 to 2014 as the existing model has a higher take-off weight and will consume more fuel to fly non-stop to the US, the spokesperson said in a text message. He too didn’t want to be named.
An Airbus executive denied the development. The Vijay Mallya-promoted airline had confirmed orders for five A380s in 2005 with France’s Airbus, with an option to buy five more, primarily for long-haul operations. That was when the country’s aviation sector was at its peak. No other Indian carrier has placed orders for the plane.
Ambitious to fly abroad, Kingfisher Airlines had even decided early in 2008 to advance the delivery of the A380s and convert its options into orders.
The list price of one A380 is $315 million (about Rs1,530 crore).
For the December quarter, Kingfisher suffered a net loss of Rs626.24 crore and an incurred initiation cost of Rs174 crore for its international operations.
Kingfisher, which started its international operation on 3 September with Bangalore-London flights, has already sold three of its five A340 planes to Nigeria’s Arik Air.
A Mumbai-based aviation analyst said any cancellation at this point of time was welcome considering declining passenger traffic. “Deferring delivery of A380 will further rationalize the capacity. This will also help Kingfisher Airlines to arrest losses,” he said on condition of anonymity.
Airbus, on its website, claims A380’s direct operating cost per seat is 15-20% lower than rival Boeing Co.’s B747-400. Airbus has so far secured orders for 198 A380s, of which 13 are already flying.
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First Published: Wed, Feb 04 2009. 10 54 PM IST