Partial lockout at Kingfisher after all flights grounded

Engineers, pilots stay away from work minister warns of closure if safety in doubt

The financially strained Kingfisher Airlines declared a partial lockout after it was forced to stop flying altogether today, as its engineers and pilots decided to stay away from work due to non-payment of their salaries since March.

As no Kingfisher flights took off across the country (nearly 80 were scheduled to), Civil Aviation Minister Ajit Singh threatened the airline with closure if something was found amiss on the safety front.

The airline has decided flight operations would be suspended for three days, until October 4. In a statement, it said, “Following a series of protracted and unabated incidents of violence, criminal intimidation, assault, wrongful restraint and other illegal acts, including refraining from attending work, by a small section of recalcitrant employees, the management has been forced to declare a partial lockout at the airline, effective immediately. With the safety of passengers in mind, the company is left with no other option but to take firm and decisive steps.”

ON THE WAY DOWN

• Apr 2011 Airline has a market share of 20% with 65 operating aircraft & around 300 flights
• Jun 2011 GMR Group (which runs Delhi and Hyderabad airports) threatens to put Kingfisher in cash-and-carry mode but defers its plan. Later in December, Mumbai airport puts it on cash-and-carry as its pending dues run up to Rs 90 cr
• Jul 2011 HPCL puts Kingfisher in cash-and-carry mode, suspends jet fuel supply
• Till Aug 11 it had the second largest  market share of 18.8% (ahead of IndiGo’s 18.7%)
• Sep 2011 Airline exits low-cost segment with Kingfisher Red; Kingfisher becomes third largest in market share at 18.4% (behind IndiGo’s 19.9%)
• Oct 2011 Salaries are not paid to employees
• Nov 2011 Over 50 flights cancelled, prompting DGCA to issue a showcause notice. Regulator also carries out financial audit of the airline
• Mar 2012 Last independent directors quit; airline files for 120 flights with 20 aircraft for summer schedule
• Aug 2012 Lowest market share at 3.2% with nine operating aircraft and  65-70 daily flights
• Oct 2012 All flights cancelled. Engineers, pilots skip work

Speaking to reporters, the aviation minister said: “This is the first time that a safety issue has come up; earlier there were issues about salaries. Till the certified engineers don't certify the air-worthiness of Kingfisher aircraft, the DGCA won’t allow them to fly.”

Singh added: “If there is a safety issue with Kingfisher, we will close it down”. The DGCA (directorate general of civil aviation) has also summoned the company’s top executives, including the CEO for a meeting tomorrow on the growing financial problems.

The development comes just weeks after the government liberalised foreign direct investment in the sector by permitting foreign carriers to invest up to 49 per cent in domestic ones. The move was expected to bail out the ailing airline and its promoter Vijay Mallya said it was in talks with foreign carriers to rope them in as strategic partners. Mallya is said to be in London.

In Mumbai, pilots were huddled in meetings and were expected to press their demands with the company’s chief financial officer later in the day. The pilots are seeking at least three months’ salary but a section among them is demanding payment of all pending dues. However, insiders say the talks did not work out as the company refused to give any assurances. Director General of Civil Aviation Arun Mishra said he was monitoring the situation closely.