5 KF cheques worth `122cr to AAI bounced in 7 months

Kingfisher Airlines has not only erred in paying its service tax and employees salaries, but has also failed in paying the requisite fees to the Airport Authority of India (AAI). Five of its cheques totaling `122.07 crore issued between August 25, 2011 and February 21, 2012 to the AAI were dishonoured due to insufficient funds.

A Right to Information (RTI) application filed by a Pune resident Sanjay Shirodkar with the AAI revealed that though these five cheques bounced, the AAI still did not initiate any action against the defaulter.

Out of the five cheques, four cheques were issued on the same day - August 25, 2011 - and they were deposited by AAI just before the cheques' six-month validity was to expire, yet all of them bounced.

"Why did the AAI not cash the cheques for so many months? Had they deposited it in August itself, then it is possible that it would not have been dishonoured," said Mr Shirodkar.

However, even in the instance wherein the AAI deposited one of cheques just a day after it was issued on February 17, 2012, the airline did not had enough funds to honour it.

"If a cheque of an ordinary person bounces, he or she is punished, but in this case, why was no action was taken against the airline?" questioned Mr Shirodkar.

It is not only Kingfisher whose cheques were rejected by the bank, but even cheques of other airlines worth lakhs have bounced. Some of these include the Qatar Airways, Go Air, Indigo, JetLite, Spicejet, Emirates, Jet Airways, etc. Ironically, there are several cases wherein cheques even for paltry sums like `520 have bounced.

Prakash Mirpuri, spokesperson and vice president, corporate communications of Kingfisher Airlines refused to clarify on the issue stating, "We do not discuss supplier and partner relationships publicly."

Meanwhile G. S. Bawa, general manager, public relations, AAI, also did not respond to calls and text messages for an explanation on the subject.

BOX:

Cheque. No Bank Amount (in Crores)
592937 ICICI Bank, Mumbai 29.15
592939 ICICI Bank, Mumbai 27.92
563639 Axis Bank, Mumbai 25
563640 Axis Bank, Mumbai 25
563496 Axis Bank, Mumbai 15

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Air India agrees to pay pending wages by June

Air India flight operations will not be affected from April 2. This follows the airline management and unions agreeing on a schedule for payment of pending wages to Air India employees by June. The payment schedule was agreed to at a meeting between AI unions and the management here on Friday.

Confirming the development, the Airline Chairman and Managing Director, Mr Rohit Nandan, told newspersons that all pending wages will be paid in a staggered manner.

Air India in a statement merely said an agreement has been reached but did not give details of the agreement. Sources, however, maintain that the management has agreed that by 15 {+t} {+h} of each month the salaries which remain unpaid currently will be paid.

Airline employees claim that they have not been paid for the last four months at least.

Earlier this week, eight AI unions had come together to form the Joint Forum of Guilds, Unions Associations of Air India. The Forum had written to the Prime Minister, Dr Manmohan Singh, saying they will be forced to go on a no-work-no-pay agitation from April 2 if pending salaries were not paid.

The Forum decision to threaten a strike comes after it failed to secure any "firm proposal" from the debt-ridden national carrier for clearing their dues at a meeting with the management in Mumbai on Wednesday.

Indian Pilots Guild, Air India Officers Association, Air India Engineers Association and Air India Aircraft Engineers Association are all part of the Joint Forum.

Interestingly, the Air Corporations Employees Union, which claims to be the oldest and largest trade union in the airline, claims there will be no strike of ground staff, cabin crew and other categories belonging to the union.

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BrahMos developmental flight successful

A new developmental flight of India's supersonic cruise missile, BrahMos, that took place on Friday provided a fund of information on the new sub-systems that were designed and developed in India and used in the flight. The missile lifted off at 10 a.m. from the Integrated Test Range at Chandipur, Orissa, from a truck. It reached its full range of 290 km at twice the speed of sound (2.8 Mach).

A BrahMos flight in steep dive mode over the Bay of Bengal took place on Wednesday. Although BrahMos had become an operational missile and been inducted into both the Army and the Navy, Friday's flight was called a developmental flight because it was aimed at testing many of the sub-systems, said A. Sivathanu Pillai, Chief Executive Officer and Managing Director, BrahMos Aerospace Limited. These sub-systems included high energy batteries, airframes, composite materials, roll-cap, canister and other hardware and software, Dr. Pillai added.

"Wednesday's flight was to test BrahMos' capability again. Friday's developmental flight was to test the adequacy of many sub-systems newly designed and developed in India. We received good data from the telemetry. It was a totally instrumented flight. From the instrumented data, we will analyse the sub-systems' performance. The mission objective was to evaluate the sub-systems' suitability," he said.

This was the 30 flight of BrahMos, a two-stage cruise missile jointly developed by Russia and India. Although it is essentially an anti-ship weapon, it can be launched land to land, sea to land and land to sea. Efforts are under way to launch it from aircraft and submarines.

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Security goof-up at airport

In an incident that raises serious security concerns, five international passengers on an Air India flight from Riyadh managed to exit the international terminal without appearing for the mandatory immigration check.

Officials said the passengers, who landed here in the morning via Mumbai, went out of the terminal along with fellow passengers in the domestic sector. The officials attributed the confusion to an error committed by airline officials who had erroneously stated the total number of international passengers as nine against the actual 14.

"The flight had 64 passengers, of whom 14 were international travellers while the rest boarded the aircraft from Mumbai. But the passenger list by the airline stated that there were 55 domestic passengers," officials said. Later, the immigration wing called back the passengers and made them appear for the immigration check. The airport company has ordered an inquiry into the incident.

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Bahrain Air suspends operations to city

Bahrain Air, the low fare premium privately owned national carrier of Bahrain that commenced direct flight operations from Bahrain to Thiruvananthapuram on March 16, has cancelled the flights over a row over traffic rights to the State capital.

Hundreds of passengers who had booked tickets in the airline from Thiruvananthapuram to Bahrain and for onward connections to other GCC points and destinations to the Levant and Africa have been affected by the suspension of flights.

Airport sources said the airline had to suspend the operations to Thiruvananthapuram since Thursday after the Director General of Civil Aviation (DGCA) had not given the mandatory nod for the continuation of the flights from Bahrain to Thiruvananthapuram airport for the summer schedule that commenced on March 25.

The flights of the airline to Karipur, Nedumbaserry and Mumbai, the three other destinations, are operating as per schedule, airport sources said. Bahrain Air launched its flights to Thiruvananthapuram as part of a bilateral agreement between the two countries and after a two-year wait.

A top Airport official said the reason for denial of rights in the summer schedule is not known and added that the airline can operate only with the DGCA nod.

Following the suspension of the flights, 100 of the 140 passengers who were stranded were flown in through Mumbai to the State capital. The airline managed to lease an aircraft of Jet Airways to operate a flight from Thiruvananthapuram to Bahrain on Friday. The flight left from here at 10 p.m. with 140 passengers.

The airline has decided to operate another flight from Thiruvananthapuram to Bahrain using the aircraft of Jet Airways on Saturday also. The flight will depart from here at 5 p.m.

Airport sources said the airline had also suspended the booking even as talks were on with Civil Aviation Ministry to resolve the issue soon.

Richard Nutall, Chief Executive Officer, Bahrain Air, had announced in the city that the four flights a week being operated on the Thiruvananthapuram-Bahrain sector would be increased to seven flights a week this summer. The Kerala Travel Agents Association has alleged a conspiracy over the denial of traffic rights to Bahrain Air without prior notice.

The association had pointed out that the airline was a relief to the NRKs when other airlines, including Air India, had increased the fare by 30 to 40 per cent to Gulf sector in view of the summer vacation.

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Aviation may be down, but training institutes still fly high

An instance is Vijay Mallya's Kingfisher Academy. His aviation business is hitting the headlines for all the wrong reasons, but students from the aviation academy are in demand. "Our academy is doing much better than our aviation business. World over, bulk carriers like Emirates, Qatar, Etihad are all growing and recruiting. Besides, many cabin crew members have resigned from India, as international players offer a better salary. Once we train students, it is not mandatory for them to join Kingfisher. So, there is continuous demand for air hostesses," said a senior official from the Kingfisher Airhostess Academy.

Industry sources say the Kingfisher Academy has shut shop at various centres but the latter denied this.

For some others, things have not been that rosy. The Air Hostess Academy, for instance, shut shop in 2009-10 and has had several complaints filed against it for failing to refund student fees. Flying Cats, another institute, recently shut down; a 'Fashionista School of Fashion Technology' is now available on the earlier contact number of Flying Cats.

In-house Training is another flying school whose present whereabouts are not known. Though their website still exists, the contact numbers on it could not be reached. A few numbers dialled by Business Standard at some centres said the institute had shut down.

Issues

"Cabin crew academies are not regulated in India and therein lies the basic problem. Unlike Pilot Training Academies, the DGCA (Directorate General of Civil Aviation) does not regulate air hostess academies, so anyone with available infrastructure can open one. Therefore there could be dozens of fly-by-night operators in large and small cities, without anyone having a finger on the actual number," says Rajan Mehra, co-founder and executive director of Asia Pacific Academy.

The boom in the airline business in 2006-2009 led to a huge requirement of cabin crew for airlines. Sector experts say many saw this as an opportunity to make big money. "Neither were these academies equipped to handle so many students, nor were a majority of these students the cabin crew material. They were all promised lucrative jobs in airlines. But after the course, most students were without jobs," added Mehra.

India has over half a dozen branded aviation training institutes. Most of these offer a one-year diploma after the higher secondary (+2) examination, which prepares the candidates (age between 17 and 24 years) to join cabin crew of airlines. Most academies charge Rs 1.5-1.75 lakh for a year's course and Rs 70-75,000 for a six-month course. Fly-by-night operators sometimes charge much less to build up volumes, say experts.

Air hostess training requires specialised courses in grooming, etiquette, communication skills, aviation, safety and handling emergency situations. Hence an academy requires highly qualified instructors, with experience gained from roles in aviation and hospitality. Most academies, however, cut costs by hiring inexperienced faculty, lacking qualifications or expertise to be able to teach and guide students, according to industry players.

The anchored ones

But some like Frankfinn Institute of Air Hostess Training, Aptech Aviation and Hospitality Academy, and Universal Training Academy are going great guns.

Frankfinn has set up around 200 centres, with more in the offing. Samir Walia, its president, marketing, says the institute got jobs for at least 5,000 students in the past year.

Universal Aviation Academy, based in Chennai, has had a fairly good placement season. Sarita Singh, placement in-charge, said demand for ground staff at airlines had not diminished.The institute offers 70-75 per cent placements every year.

At Kompass Aviation, though there was a standstill in placements three months earlier, the situation is back on track, says Amrutha Lily Jathanna, senior HR professional at the institute looking after these. The institute offers 85 per cent placement and Jathanna expects the situation to bounce back after April. Cabin crew placements are doing better than others at the institute.

Industry insiders say institutes which had only concentrated on air hostess training had to face the brunt of a hiring crisis and eventually shut down.

"The big players have an array of courses that help them overcome aviation crises, as a slowdown is witnessed in cabin crew recuitment and not ground staff hiring and similar areas," said a placement official of an aviation institute.

Head-hunters say the aviation sector may be going through a rough patch, but it's too early to panic. "Every sector has its business cycle of ups and down. The sector is not hiring rapidly. But in the next three to four months, we expect the situation to stabilise," said E Balaji, MD & CEO, Ma Foi Randstad.

Aptech Aviation and Hospitality Academy, earlier known as Avalon Academy, says the aviation industry's situation has not impacted it.

"At our institute, we are also seeing smaller private airports sending their employees for skill training. Further, we are focusing on airport managment and ground handling, apart from courses for air hostess training. This makes us well diversified," said Shrutidhar Paliwal, vice-president (corporate communications and media relations).

He said Air India Singapore Airport Terminal Services had recruited from them this year. The institute has a placement record of 85-90 per cent and has both national and international airlines coming for placements.

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Aviation sector passing through turbulent times

NEW DELHI: The aviation sector in the country is facing many challenges like decrease in passenger movement, high fuel costs, high airport charges and inadequate fares recovery due to intense competition. Industry sources have placed `26,000 crore as the operational losses for 2007-2010 period and anticipated `10,000 crore for 2011-12 alone.

While the passenger movement has decreased from 16.6 per cent to 9.3 per cent in January-February this year as compared to last year, the aircraft movement reduced from 19.7 per cent to 11.2 per cent.

The setback is largely attributable to high fuel costs.

The sector had also suffered from inadequate fares recovery due to intense competition. Almost all the airline were operating below the cost-meeting margins, bringing the sector down as a whole.

Alarmed by the sudden losses that all the airline (except Indigo) incurred, the Aviation Ministry woke up to gathering key details. Apart from understanding whether these losses were making airline cut corners and not operate mandatory routes as per the Route Dispersal Guidelines, the ministry also set up an inter-ministerial group to analyse factors causing the problem.

Airline were asked to submit a recovery plan in order to avail further relaxations from banks. Recently, the ministry also gathered data from the airline on the extent of the External Commercial Borrowings that they would want when the sector is opened up. One airline, Air Asia, had informed about suspension of its services from Mumbai and Delhi.

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Court seeks info on airport clearances

A Division Bench of the Kerala High Court on Thursday directed the Centre and State governments to provide details of clearances given for constructing a greenfield airport in Aranmula.

The Bench comprising Acting Chief Justice Manjula Chellur and Justice V. Chitambaresh gave the directive on a writ petition filed by poet Sugathakumari and two others challenging the sanction given by the State government for constructing the airport.

According to the petitioners, the proposed airport did not have the requisite environmental clearance. It was being constructed after filling paddy fields. Therefore, it was against the provisions of the Kerala Conservation of Paddy and Wetland Act and Rules. The clearance had been granted under the provisions of the Kerala Industrial Single Window Clearance Board and Industrial Township Areas Development Act.

They said that the Act did not empower the State government to notify a particular area as industrial and accord clearance for the project in the area. It was applicable only to projects coming up in declared industrial areas. They contended that the project would damage the area's ecosystem. They also pointed out that there was no need for another airport in Aranmula as three airports - Thiruvananthapuram, Nedumbassery, and Navy airport - were located within 150-km radius of Aranmula.

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Kingfisher, among several airlines whose cheques to AAI have bounced

New Delhi, March 29:

During 2011, Kingfisher Airlines presented five cheques totalling Rs 122.07 crore to the Airports Authority of India (AAI), which could not be encashed due insufficient funds in the accounts of the airline.

This has been revealed in an RTI filed by a Pune-based RTI activist, Mr Sanjay Ramesh Shirodkar.

Three cheques worth Rs 65 crore were drawn on Axis Bank, Mumbai, while the remaining two were on ICICI Bank, the data provided by AAI in the RTI reply shows.

The RTI reply also shows that Kingfisher is not the only airline whose cheques to AAI bounced. Between January 1, 2000 and February 14 this year, several domestic and international airlines gave cheques to AAI that bounced.

The domestic airlines include IndiGo, Jet Airways, JetLite while the international airlines include Emirates and Qatar Airways.

Interestingly, the cheques that bounced have been those that have been presented at the Ahmedabad and Pune airports only. The State-owned AAI owns and manages 92 airports and 28 civil enclaves at defence airfields and provides air traffic services over the entire Indian airspace and adjoining oceanic areas.

While the law allows a person or institution who presents a cheque which bounces to file a suit for recovery of funds, it was not immediate clear what action AAI initiated against these airlines.

Meanwhile, Jet Airways maintained that there had been no instance of payments due to AAI.

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8 AI unions threaten to go on strike from April 2

Spelling fresh trouble for crisis-ridden Air India , 8 unions representing a large chunk of the over 28,000 staff, today threatened to go on strike from Monday to protest delay in salary payments and sought Prime Minister's immediate intervention to resolve the situation.

As the management called the agitating employees for talks tomorrow, Civil Aviation Minister Ajit Singh tried to soothe ruffled feathers of the protesters saying the government has "stood by them" before and would continue to do so.

The eight major unions, representing a cross-section of staffers ranging from pilots, engineers to ground staff, wrote to Prime Minister Manmohan Singh , saying they would implement 'No pay no work' policy from April 2 as the management was "withholding" their "legitimate wages".
Reacting to the threat, the civil aviation minister said, "Let's hope they will realise that the government is doing all it can. The government has already intervened."
"The Financial Restructuring Plan (FRP) has been cleared by the Group of Ministers. A (cabinet) note has been moved. The Prime Minister was away for 2-3 days. So CCEA (Cabinet Committee on Economic Affairs) has to be convened," Singh said, adding even the employees realise that "they are better off than employees of other airlines".
The agitators have alleged that they have not been paid salaries and allowances for over past three months.
"We will no longer be able to bear this agony which has been thrust upon us for no fault of ours. Therefore, we reiterate that if the management continues to withhold our legitimate wages, we will not be able to discharge our duties from April 2.


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Deccan Chargers to fly high with Emirates

Dubai-based airline Emirates will be the principal sponsor for Deccan Chargers, a unit of Deccan Chronicle Holdings Limited that owns the IPL franchise from Hyderabad, for the forthcoming season starting April 7.

The three-year team sponsorship agreement with Deccan Chargers, the second for Emirates in IPL with the previous one being with Kings XI Punjab, will bring into its fold rights and entitlements to display their official logo on platforms that include the Hyderabad side's apparel, in-stadia branding, for premium hospitality and match tickets, official merchandise and access to the franchise's players.

Sports sponsorships have always been a very successful marketing tool for Emirates. With cricket being the number one sport in India, it is a natural choice for us to go for it," Orhan Abbas, vice-president (India and Nepal), Emirates, told Business Standard.

Besides IPL, Emirates' sponsorship portfolio spans across various sports disciplines including golf, horse races and football (Fifa World Cup).

The airline, which spends one per cent of its annual revenues on sports sponsorships, also owns Emirates Stadium, an association football stadium in London, which is the current home of Arsenal Football Club.

"More than branding opportunities, the partnership with Deccan Chargers will allow us to directly go to our customers and show them that we are investing back into this country, too," Abbas said.

Earlier, addressing a press conference here on Wednesday, Deccan Chargers' chief operating officer Venkat Reddy said the team had gone through difficult commercial conditions last year, in terms of signing up team sponsors, because of the ICC World Cup.

Deccan Chargers, which emerged as the winner of the 2009 season of the IPL, had a bad start last year, losing all the matches played at their home ground.

"We are fully charged up for this season. Last year, we had 85 per cent capacity for all our matches. We expect our matches at Cuttack, Vizag and Hyderabad to be fully-packed this season," he said.

Replying to a query on whether the company's plans to sell stake in the franchise are still afloat, Reddy replied in the negative. "The team was never put on for sale at all. It will continue to be part of Deccan Chronicle," he added.

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Call to tap potential in aviation

Kerala should exploit the immense opportunities in the aviation sector brought about by rapid changes in the aviation scenario and the construction of the fourth international airport at Kannur, Chief Minister Oommen Chandy said.

Speaking after laying the foundation stone for a Academy complex of the Rajiv Gandhi Academy for Aviation Technology (RGAAT), near the new international terminal of Thiruvananthapuram international airport, and Air India's Aircraft Maintenance Base at Chakka on Wednesday, the Chief Minister said the youth should be trained to tap the opportunities. The government would provide all support to youth who were willing to take up a career in aviation and associated fields, he said.

Airstrips

The airstrips proposed in the budget for the districts that do not have airports and the commissioning of the airport at Kannur would further change the scenario, he said. Mr. Chandy said the three international airports in the State, Thiruvananthapuram, Nedumbaserry, and Karipur, were faring well.

Presiding over the function, Minister for Forests and Sports K.B. Ganesh Kumar, who is the chairman of the academy, said the government would make the academy an international pilot training centre. It would be open to those who want to take a full-time career in flying.

The Minister called upon the students to cooperate with the authorities to make the academy world-class. Funds would not be a problem for the development of the academy, he said adding that the firm that had been entrusted with the work of the complex had been told to complete it in a time-bound manner.

The new aircraft to be acquired by the academy would also be used for disaster management in addition to providing training to pilot students. The government hoped to use the proposed air strips in the districts for the use of aircraft for emergencies.

Minister for Transport and Devaswom V.S. Sivakumar; Air Marshall S.P. Singh, Air Officer Commanding in Chief, Southern Air Command; Principal Secretary, Transport, Tom Jose; executive vice-chairman of RGAAT V. Thulasidas; Airport Director G. Chandramouli; and councillor B. Padmakumar; spoke.

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Aviation academy to expand operations

The proposed academy complex of the Rajiv Gandhi Academy for Aviation Technology (RGAAT), the only pilot training institution in the State, is aimed at enabling the State-owned institution to expand its operations, launch new courses, and provide world class training to the future pilots.

The Rs.9-crore academy complex is coming adjacent to the new international terminal of Thiruvananthapuram International Airport and Air India's Aircraft Maintenance Base at Chakka in the 2.71 acres of land provided by the government. At present, the academy has no hangar to park the four aircraft as it had been demolished for the development of the new international terminal.

The 22,000 sq.ft. complex will have a hangar, which can accommodate eight single engine aircraft and one twin-engine aircraft, a fuel store and four-storeyed academy building. On completion, the complex would have all modern facilities and even a swimming pool, Minister for Forests and Sports and Chairman of Academy K.B. Ganesh Kumar said. The BSNL Engineering wing had been entrusted with the work.

Apart from pilot training and practical training in aircraft maintenance engineering, the RGAAT has plans to commence Full Aircraft Maintenance Engineering course, B.Sc. Aviation course for Commercial Pilot Licence (CPL) & AME, Cabin Crew Training and Flight Despatcher course. Talks are on with the University of Kerala and Indira Gandhi National Open University (IGNOU) to offer degree to students.

The academy that functioned out of the premier international airport of the State needed its own airstrip so that intense flying training could be provided to students, Executive Vice-Chairman V. Thulasidas said. Finance Minister K.M. Mani had announced construction of airstrips in districts that did not have airport in the 2012-13 budget.

Once these airstrips are built, the RGAAT is of the view that their requirement of intense flying can be achieved.

The main courses offered are Private Pilot Licence (PPL) and CPL. At present, there are 37 students for pilot training and 12 of them have already acquired PPL, with another four becoming eligible for PPL shortly. Six have completed the examinations and have acquired eligibility for CPL. In addition, 20 are undergoing practical training in aircraft maintenance engineering.

The Academy has three Cessna 172 R aircraft, including a modern glass cockpit aircraft provided by the Aero Club of India. Aero Club is to provide a single engine light sports aircraft (CTLS) also to the academy, which has already reached the country. The academy has decided to add one more Cessna 172 R aircraft with the funds provided by the government in the budget for 2011-12.

Steps had been taken to increase the number of instructors. The academy is to procure a twin engine aircraft at a cost of Rs.6 crore.

Experience on a twin engine aircraft after CPL will help students passing out of the academy for getting employment in airline companies.

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For Emirates, India is bringing in the cargo

Chennai, March 28:

India is the one of the few countries showing growth in cargo operations for Emirates. The airline is feeling the pressure of the Euro crisis and the US economic downturn in the Asian region, particularly South East Asia.

"India is showing single digit growth while other countries are flat. Australia and Africa are also showing growth. South East Asia has declined, especially in the last two quarters," said Mr Pradeep Kumar, Senior Vice President, Cargo Revenue Optimisation and Systems of Emirates.

Nearly 10 per cent of Emirate's cargo handling comes from India. Mr Kumar said with India showing growth, the airline was not averse to increasing freight capacity. At present, the airline operates one schedule freighter to Chennai, from Dubai, enroute to Hong Kong. On the return route, the freighter goes directly to Dubai.

The airline used to operate two regular freighters to Chennai, but withdrew one eight months ago due to the slowdown. "We may look at reviving the service if the situation improves," he said without giving a timeframe.

Emirates also carries cargo in its regular wide bodied passenger aircrafts with a maximum capacity of 22 tonnes. "This is nearly the size of our small freighter that operates out of India," he said.

The airline had a 15.4 per cent market share in cargo exports and 11.7 per cent in imports in the last financial year. The total cargo handled in the country was 1.30 lakh tonnes.

Till some time ago, garments accounted for nearly 60 per cent of exports from Chennai, garment exports have dropped by 20 per cent in 2011. "Telecom, auto and electronics account for a chunk of the cargo mix."

The airline has 171 aircrafts, including eight dedicated freighters, globally.

According to Mr Kumar, the 2011 financial year will be 'flat'. In 2009, the industry faced a similar situation. However, things improved in 2010 but worsened since then, he said. "We expect things to pick up in the second half of 2012."

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Emirates to sponsor Deccan Chargers

Hyderabad, March 28:

Emirates today announced that it has chosen to become the team sponsor of Indian Premier League (IPL) side Deccan Chargers for the next three years.

The international airliner based out of Dubai would support the Hyderabad club, part of the Deccan Chronicle group which won the IPL in 2009, for the forthcoming season starting next month.

The Deccan Chargers will begin its title challenge against the Chennai Super Kings in Vizag. The team is lead by Sri Lanka's Kumara Sangakkara and has South African stars, J.P. Duminy and Dale Steyn, and Australian, Cameron White, among others turning out for it.

Ms Gayatri Reddy, Deccan Chargers Co-owner, said, "We look forward to the tournament and repeating our winning performance in DLF IPL 2012." The IPL team management denied they were divesting stake in the team.

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DGCA warns against 'opaque fare'

New Delhi, March 28:

The Director-General of Civil Aviation (DGCA) has come to the aid of air travellers who were falling prey to low-fare schemes on travel portals.

In a communication to the airlines on Wednesday, the DGCA has asked them not to participate in any scheme where complete information about the carrier is not revealed upfront.

This follows revelation by Jet Airways that a number of travel portals were using this scheme to sell the inventory which they had bought from Kingfisher. The travel portals were selling tickets without disclosing the name of the carrier.

On investigations, the DGCA found that the airlines were participating in scheme where a special fare - 'Opaque' fare - was being offered by the portals. Under such schemes, the identity of neither the carrier nor flight details are revealed till the payment is through and ticketing done.

The DGCA said this is in violation of aircraft rules 1937. A DGCA official said that this is almost cheating the passenger especially when somebody books a ticket on the basis of very low fare and then finds the flight is of Kingfisher Airlines.

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Air India staff write to PM on unpaid wages, threaten strike

New Delhi, March 28:

A question mark hangs on whether Air India operations will be affected from April 2. The Joint Forum of Guilds, Unions Associations of Air India has written to the Prime Minister urging his intervention to ensure that their "legitimate wages" of several months are paid.

The Joint Forum has threatened that they "will be unable to discharge their duties from April 2" if their dues were not paid. Eight unions have come together to form the Joint Forum. "While we appreciate the financial difficulty facing the company, however, unlike Air India which can turn to the Central Government for funds, employees have no such option. The employees and their families have to suffer the humiliation of loan defaults," the Forum said in a statement.

The Forum decision to threaten a strike comes after it failed to secure any "firm proposal" from the debt-ridden national carrier for clearing their dues at a meeting with the management in Mumbai on Wednesday.

Indian Pilots Guild, Air India Officers Association, Air India Engineers Association and Air India Aircraft Engineers Association are all part of the Joint Forum.

Interestingly, the Air Corporations Employees Union, which claims to be the oldest and largest trade union in the airline, claims there will be no strike of ground staff, cabin crew and other categories belonging to the Union.

The Airline Management had earlier given a commitment of paying the pending wages in a staggered manner.

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Kingfisher to return five ATR aircraft

New Delhi, March 28:

Kingfisher Airlines' fleet size will shrink further in the next few days.

This follows the impending deregistration and eventual return of at least five ATR aircraft. The turbo-prop aircraft are used for flights to secondary cities.

In the last few days, the Directorate General of Civil Aviation received a letter from a lawyer firm to deregister the five ATR aircraft. Sources indicated that the exit of the aircraft will not affect the operations of Kingfisher Airlines as the new schedule does not include them.

Industry sources claim that the number of narrow body aircraft being deregistered could more than double. The narrow body aircraft in the airline's fleet include Airbus A-320 and ATR. Industry sources point out that another five aircraft could also be taken back by the lessors.

Kingfisher Airlines officials were not immediately available for comment. However, earlier the airline had indicated that with rising losses and banks accounts being frozen, each route and aircraft was being carefully looked at to see which ones were viable.

The airline is currently operating a fleet of 20 aircraft of which 16 are used to operate flights. Earlier, the airline operated a fleet of more than 60 aircraft. It now operates about 120 daily flights, down from more than the 400 flights earlier.

Independent Directors

Meanwhile, the airline has appointed three new independent directors including Mr Manmohan Singh Kapur, former Executive Director and Officiating Chairman and Managing Director, Syndicate Bank and Punjab and Sind Bank. Besides, distinguished lawyer Mr Lalit Bhasin and former Board member of State Bank of India, and former Managing Director, Kolhapur Sugar Mills, Mr Shrikant Ruparel, have also been appointed as independent directors.

More time

The airline got some respite with the Central Board of Excise and Customs indicating that it "might" give the airline some more time to settle its service tax dues. "We cannot kill the airline. We might give some more time to clear dues beyond March 31," senior Finance Ministry officials said. The airline agreed to pay Rs 10 crore of the Rs 76-crore service tax dues this fiscal. The Department has frozen at least 40 airline accounts to recover the dues.

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State attracts Rs 4,846 cr investment at Aero Park

The Karnataka government, which is promoting Bangalore as a potential hub for aerospace industry in the country, has seen investment proposals from as many as 54 companies for a combined investment of Rs 4,846 crore. Of these, 46 proposals are in the small and medium enterprises segment and the rest are major projects with investment of over Rs 50 crore cleared by the state high level clearance committee (SHLCC). Once set up, these projects are expected to generate employment for about 30,000 people.

"We have identified the aerospace sector as a focus area for attracting investment into the state. The state has an ideal ecosystem for the sector and we want to cash in on this not only to sustain Karnataka's position as the country's aviation hub, but also to encourage and support the MSMEs in the sector," M Maheshwar Rao, commissioner, department of commerce and industries, government of Karnataka told Business Standard.

The state has acquired 982 acres near the Bangalore international airport for the aerospace park, of which 250 acres have been set apart for the aerospace Special Economic Zone (SEZ). The government till now has allotted 218 acres to 25 companies at the SEZ. The major investors at the SEZ include Hindustan Aeronautics Limited (Rs 2,095 crore), Dynamatic Technologies (Rs 465.8 crore), Jupiter Aviation Logistics (Rs 630 crore), BEML Limited (Rs 316 crore), Mahindra Aerospace Pvt Ltd (Rs 284 crore), European Aeronautics Defence and Space Company (Rs 278.2 crore), Sobha Aviation and Engineering Services, Tyco Electronics Corporation India, AMADA (India) Pvt Ltd and Wipro Ltd (Rs 52.05 crore) among others.

These companies are setting up manufacturing plants for producing aircraft components, assemblies, MRO activities related to aerospace applications, aerospace actuators and parts, engine and engine components, welded structural assemblies, aviation training academy among others. Further, Rao said the government expects to attract more companies to the aerospace SEZ during the forthcoming global investors' meet (GIM) in June 2012. At the recently concluded India Aviation 2012 held in Hyderabad, the government had fruitful discussions with several global and Indian players in the aviation sector, he said.

He also said the state government and Confederation of Indian Industry (CII) have formed a joint task force on aerospace with the overall intent of promoting and developing the state's aerospace industry.

The government also proposes to establish a Technology Innovation Centre on aerospace at the Bangalore Aerospace Park to provide R&D support, particularly to SMEs. The government plans to approach organisations like ISRO, USIBC, NAL, EADS and Honeywell among others to become stake holders in the Technology Innovation centre. As recommended by the Joint Task Force, the government hopes to set up an aerospace university in the near future to cater to the human resources for the aviation sector, he added.

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Tribunal directs taxmen to defreeze bank accounts

Kingfisher Airlines has got a breather as the Bangalore Bench of the Income Tax Appellate Tribunal has directed the Income-Tax Department to lift immediately all attachments, including bank accounts, which were frozen for non-payment of Rs.349.09 crore tax deducted at source (TDS) by the company.

However, the Tribunal, in its interim order, has asked the company to immediately pay Rs.44 crore of the total outstanding and pay the remaining amount in weekly instalments of Rs.9 crore each, commencing from April 4. The Tribunal issued interim directions last week on an appeal filed by the company challenging the demand made by the Department in its December 30, 2011, order.

"The business activities of the assessee [company] are disturbed due to the attachments of bank accounts. The demand of the Department may be met by the assessee when it is allowed to run the business smoothly and earn something from that business. By putting the business of the assessee at halt through attachment is not a solution," said the Bench, comprising N. K. Saini (Accountant Member) and George George K (Judicial Member).

The Department had demanded payment of Rs.372 crore as TDS from the company for assessment years 2010-11, 2011-12, and 2012-13, following analysis of records during search conducted in the company's premises. The Department had attached bank accounts of the company in February, as the company did not make payment, and had collected Rs.23 crore while attaching the bank accounts.

The Department had contended before the Tribunal that the company had illegally withheld the revenue payable to the government even after deducting the said amount from various sources in the two years.

However, the company had contended that the department should have appreciated it [company] was having acute financial difficulties besides claiming that it was not given sufficient opportunity of hearing before passing the final orders for making payment, among other contentions.

The Tribunal, however, has said that the company prima facie has an arguable case and the balance of convenience also lies in favour of the company, while noticing a letter written by company's Chairman and Managing Director to the Department on March 9 proposing to pay the outstanding tax in eight equal monthly instalments of Rs.44.60 crore.

Source

AI to directly import aviation turbine fuel

The carrier is expecting an equity infusion in 2012-13

Ailing national carrier Air India has decided to go in for direct import of Aviation Turbine Fuel (ATF) in a bid to curb the escalating cost.

The AI board, which approved the direct import on Tuesday, also gave a go-ahead to the state-owned carrier to soon appoint a service provider who would source the supply as well as provide the necessary infrastructure for storage and distribution of the same for in-plane fuelling.

AI expects to end the year with a higher-than-budgeted performance in the revenues. However, the escalating cost in fuel is likely to set it back by an additional Rs. 2,200 crore and its fuel bill is estimated to be around Rs. 8,000 crore for 2011-12. Added to this, the additional interest cost of Rs.1,500 crore eroded the profitability of the airline.

The board also took on record the progress on the restructuring of the working capital into long-term loans whereby Rs.11,000 crore worth of working capital is proposed to be converted into long-term loans and Rs. 3,400 crore into cash credit facilities.

The government would provide support in respect of the non-convertible debentures of Rs. 7,400 crore.

AI is expecting an equity infusion shortly in the financial year 2012-13, which would not only improve its operating and financial parameters but would also give considerable comfort to the institutional lenders in the form of better net worth.

Meanwhile, AI's operating and financial performance up to February this year registered a continuous increase compared to last year. The passenger revenue during February 2012 went up to Rs. 949 crore from Rs. 718 crore in February 2011, registering a 32.2 per cent increase.

As part of the risk management strategy, the board approved the hedging of fuel up to 20 per cent of the total international uplifts and allotted a specific amount in its budget. A risk management team of senior officials was set up in order to continuously monitor and take positions on fuel hedging.

Source

Air India board okays direct import of jet fuel

New Delhi, March 27:

National carrier Air India's board of directors has decided to import jet fuel directly. The board also approved the hedging of fuel up to 20 per cent of the total fuel uplifted abroad.

According to a statement issued after the board meeting, Air India would shortly appoint a service provider. It will source the supply as well as provide the necessary infrastructure for storage and distribution of the same for in-plane fuelling.

Meanwhile, the company claimed its financial and operating performance up to February had improved significantly. Passenger revenue in February went up to Rs 949 crore from Rs 718 crore in February 2011, an increase of 32.2 per cent, the airline said in a statement.

The total number of passengers who flew Air India also went up from 0.962 million in February 2011 to 1.091 million in February 2012, registering an increase of 13.4 per cent. Air India expects to end the year with higher than budgeted performance in revenues.

However, the escalating fuel cost is likely to add Rs 2,200 crore to its fuel bill, which is estimated to be around Rs 8,000 crore for 2011-12. Additional interest cost of Rs 1,500 crore also eroded its profitability, the airline said.

The board also approved the capital budget for 2012-13, which was in line with the annual plan outlay of the company involving a capital outlay of over Rs 400 crore on non-aircraft projects.

The bridge financing of the two 787 Dreamliner aircraft, which would be raised from Standard Chartered Bank, of $195 million, was also approved by the board. The bridge financing is expected to be closed soon.

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Kingfisher suspends flights to some more cities

New Delhi, March 27:

Kingfisher Airlines has asked most of its staff members "to stay home" in cities around the country to which it has "temporarily suspended" flights.

The airline which used to operate to about 60 destinations now flies to less than 30 cities. Kolkata, Hyderabad, Patna, Lucknow, Thiruvananthapuram and Bhubaneshwar are among the cities to which the airline has "temporarily suspended" operations.

The airline's management has said that since Kingfisher "could resume" operations after getting re-capitalised, most staff members will remain on the company's rolls despite staying at home in cities to which flights have been suspended. The airline now operates about 120 daily flights down from more than the 400 flights that it operated earlier.

The airline, however, failed to quell speculations that it is planning to go in for large scale staff retrenchment. In a statement it merely said that it is in a "holding pattern" and is waiting for various decisions from the Government, the consortium of bankers on foreign direct investment and working capital funding among others.

"All of these will have a major impact on the staffing decisions we will have to make," the airline said in a statement. Kingfisher has not given the number of cities to which it has curtailed operations or the number of employees it has asked to stay home. The cash-strapped airline has about 5,400 employees.

"Staff members are being asked not to report for duty the day after a flight has reached. They are just told that there will be no operations from the next day," a disgruntled employee said.

Kingfisher has said that in the holding plan "adequate care" has been taken to ensure that part of the airline's "core inter-metro schedule is retained, while connectivity is maintained to many cities where Kingfisher is the sole operator".

The statement adds that the airline has started its summer schedule operating about 120 daily flights with 20 dedicated aircraft.

Interestingly, the DGCA Web site shows that till April 10 this year, Kingfisher Airlines' international operations will only be a daily flight between Delhi and London. Earlier the airline used to operate to Hong Kong, Singapore, Dubai, Bangkok, Kathmandu, Colombo and Dhaka.

The airline, which has debt of about Rs 7,000 crore, has failed to pay its staff over the last couple of months. The airline reported a 75 per cent increase in its net loss at Rs 444 crore for the quarter ended December 2011.

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Indian airlines' global traffic growth slumps

Kingfisher & AI woes, lack of good airports and freeze on permits for new flights all contribute to the decline

There has been a substantial fall in the growth rate of international passenger carriage by Indian airline companies during 2011, as compared to 2010.

Among the reasons are ailing Kingfisher Airlines pulling out flights and the financial problems of carriers, leading to reliability issues.

International passenger carriage by Indian airlines - Air India (AI), Jet Airways, Kingfisher, SpiceJet and IndiGo ply abroad - rose during 2010 by 16.2 per cent. Directorate general of civil aviation (DGCA) data shows they carried 13.2 million passengers on flights abroad in 2011, a rise from 12.9 mn in 2010. Or, a percentage rise of barely three per cent.

The Indian carriers witnessed a decline in international passenger carriage of 14 per cent, 16.9 per cent and 14.8 per cent in the months of October, November and December, the period when Kingfisher started pulling out flights. International carriers, however, increased their passenger load by 9.3 per cent to 26.7 mn during 2011 from 24.4 mn during 2010.

The growth in number of international passengers, inbound and outbound, during the period also slowed to 7.5 per cent, to 39.9 mn This number had grown in 2010 by 11.4 per cent to 33.3 mn in 2010.

Reasons

Insiders feel Indian carriers lack in reliability, public perception and network, with things getting worse after Kingfisher's pull out. "All the full-service Indian carriers are in bad financial shape, thus impacting their operations. This has raised questions on their reliability and has earned them a bad name. The pull out by Kingfisher and various strikes in AI has also impacted the public perception about Indian carriers," said Ajay Prakash, president of the Travel Agents Federation of India, representing half of the country's travel agents.

He said there was a time when AI was one of the top 10 airlines in the world. Not now. "International carriers provide brilliant network and service, attracting passengers," he added.

Some airlines say the government's long freeze on new applications for Indian carriers to fly abroad has led to this. "The foreign carriers are utilising almost all their bilateral rights in most of the cases but we have been barred from going international to protect our national carrier (AI). Had we been allowed to go international, things would have been much better," said a senior Jet executive, who did not want to be identified.

India has signed bilateral rights with 109 countries and offers carriers 834,000 weekly seats on international air routes. Indian carriers utilise only 22.7 per cent of the total bilateral quota, contrary to around 40 per cent utilisation by foreign carriers. Of the 22.7 per cent utilisation by Indian carriers, AI has 11.9 per cent and the other four private carriers that fly abroad together utilise the other 10.8 per cent.

Measures

New civil aviation minister Ajit Singh has just recently allowed increasing the utilisation of foreign bilateral rights for Indian carriers to 40 per cent from the summer schedule, starting April.

However, others say much more is needed. "We cannot compete with international carriers just by more flights. The bigger problem is that the international carriers have been allowed to fly even to smaller cities, where they get lot of passengers. Even if we fly more, it will be difficult for us to recover the market share lost dee to Kingfisher's absence," said a senior AI executive, who did not want to be identified.

He further said there was a lack of world-class airports, which could become hubs. "Passengers are ready to take a stop at Dubai and Frankfurt but the same passengers do not want to stop at an Indian airport. Barring Delhi, we do not have any of international standard. Foreign carriers also attract a lot of traffic (through the sixth freedom, the right of a commercial aviation company to fly from a foreign country to another while stopping in one's own country for non-technical reasons) that they route through their hubs," the official added. A sixth of the total traffic foreign carriers have is through this, routed through their hubs to their respective destinations.

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Airport fee: Ajit Singh rules out changes in aviation rules

New Delhi, March 25:

The Civil Aviation Ministry has ruled out the possibility of amending the Airports Authority of India (Major Airports) Development Fees Rules, 2011, which allowed the levy of development fee by private airports.

The Opposition has moved amendments to the rules in the Rajya Sabha saying that the Government should not levy development fee from the passengers. The matter, which could not be taken up in the winter session, is likely to be considered during the current session of Parliament.

Legally in order

In a letter to the CPI (M) MP, Mr K.N. Balagopal, who has moved the amendments in the Upper House, the Civil Aviation Minister, Mr Ajit Singh, said that the rules framed are in accordance with the provisions of the Airports Authority of India Act and are legally in order.

Mr Balagopal had challenged the Government's decision to allow the private airports to levy development fee.

He had said in a letter to Mr Singh that no charges should be levied unless the amendments to the rules are discussed in the Rajya Sabha.

Law Ministry views

Mr Singh said in his reply that the Ministry examined the modifications proposed by Mr Balagopal.

"I would further like to inform you that modifications suggested by you were also examined in consultation with the Ministry of Law and Justice which is of the considered opinion that rules framed under the Act are in accordance with provisions of the AAI Act and are legally in order," Mr Singh said.

Mr Singh told Business Line that the new set of rules for the AAI Act were laid after a Supreme Court order on the issue of collecting development fee.

"Two airports have already started using the fee for the development of infrastructure. So, there is no point now in amending the rules," he said.

Mr Balagopal, however, challenged this position. "The Minister is trying to protect private airports by misinterpreting the Supreme Court order. His letter is misleading. Parliament has the absolute authority to amend rules and the matter should be discussed in the Rajya Sabha at the earliest," Mr Balagopal said. 

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What Indian aviation needs to do to fly higher

March 25, 2012:

The Vijay Mallya-led Kingfisher Airlines may be struggling to stitch together a flight plan to stay afloat. Jet Airways could be facing tax problems of its own. Five out of the six Indian carriers have posted losses over the last three quarters.

But chieftains of global aviation industry describe this phase as but another "air pocket," which will soon pass and clear the runway for domestic aviation to take off on a more sustainable growth path.

This, clearly, was the postscript of the five-day 'India Aviation 2012' that recently concluded in Hyderabad, attracting global players in the airlines, airport and engine manufacturing sectors.

A stellar period

Indeed, the Indian aviation sector gained substantial altitude during the Eleventh Plan period, climbing to the perch of the ninth largest civil aviation market in 2011.

Not only did passenger throughput swell from 73 million in 2005-06 to about 150 million last year, but this period also saw four international airports getting completed.

The investment made by private airport operators was about Rs 30,000 crore in the last five years, involving greenfield airports in Hyderabad and Bangalore and modernisation of Delhi and Mumbai airports. Not only this, by 2011, five Indian carriers were operating on international routes and India had bilateral agreements with 104 countries.

But, aviation experts maintain, this is only the beginning of the Indian aviation story. India now plans to be among the top three aviation markets by 2020.

Aviation players see this as an achievable goal, given the right policy initiatives and a stronger Government-industry interaction. Boeing estimates that travel to, from and within South Asia is expected to achieve an average annual growth rate of 8.1 per cent in the next 20 years, outpacing growth in all other regions.

Airbus has revised its market forecast for India, stating that the country will require 1,040 aircraft worth $145 billion in the next 20 years. A KPMG-FICCI report shows that the Indian aviation industry is today worth $12 billion, with the airlines and airport segment constituting about four-fifths of this. And investments worth $50 billion are envisaged in the next five years or so.

Estimates from the Airport Authority of India and the private sector indicate that Indian airports would require an investment of about Rs 65,000 crore during the next Plan Period, of which Rs 50,000 crore will come from the private sector.

While Indian carriers plan to increase their fleet size to 800 in the next five years, the general aviation sector is likely to see $4.3-billion worth investment, with the addition of 300 business jets, 300 small aircraft and 250 helicopters.

Bumps on the way

But despite the global optimism, the flight path for this sector is not without its turbulence. Supply outstripping demand, spiralling jet fuel prices, rupee depreciation, stiff interest regime and intense competition are some of the factors that have kept profitability of Indian carriers under severe duress.

The KPMG report points out that five out of the six Indian carriers have posted losses over the last three quarters - some have not been able to net a profit ever since their operations began. All the three listed carriers have posted consecutive losses for the three quarters of the current fiscal, piling up crushing debts.

"Between 2008-09 and 2010-11, Indian carriers, barring Air India, have accumulated losses of about Rs 10,000 crore. And that this is happening despite an over 15 per cent annual growth in passenger traffic points towards systemic flaws in the industry," it says.

Kingfisher Airlines' woes are well-known, having come to such a boil that doubts are being whispered on how long Mr Mallya could remain in the cockpit.

Doubtless, high cost of air turbine fuel (ATF) has been the cardinal dampener. ATF accounts for more than 50 per cent of airlines' operating cost, while it is half of this in other countries. Sales tax in Gujarat for instance is as high as 30 per cent, while it is 29 per cent in Tamil Nadu and Madhya Pradesh.

According to KPMG analysts, ATF in India is nearly 60 per cent costlier than competing hubs such as Dubai, Singapore and Kuala Lumpur. The Government has agreed to the airlines' demand for direct import of the fuel. But, the KPMG reports says, this may actually bruise India's brand image.

ATF import will hurt

"India is an ATF-surplus country that exported nearly 45 per cent of its ATF production in 2010. It may appear strange that airlines in an ATF-surplus country end up importing fuel just to work around the prevailing taxation policies," it says.

And direct import of the fuel may not be as promising for airlines as it sounds. For, carriers will have to depend on oil companies, which could charge a premium for handling imported ATF.

"There is also the risk that some State Governments may put entry taxes on imported ATF once they realise their tax revenues are being compromised," the report points out.

What, then, is the way forward? Notification of ATF under the 'declared goods' category with a uniform application of 4 per cent sales tax, improvement of air connectivity to tier-2 and -3 cities, implementation of the 49 per cent foreign direct investment limit policy, close collaborations among Ministries related to the sector, development of regional airports and promotion of allied sectors such as maintenance, repair and overhaul could be some of the starters.

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Hind Aeronautics calls bids for new MMRCA complex

Bangalore, March 25:

Defense aircraft maker Hindustan Aeronautics Ltd has invited bids to build a new design and manufacturing complex in Bangalore for MMRCA fighter planes.

The facility is estimated to cost Rs 360 crore and is to be completed two years from the award date.

The IAF is acquiring at least 126 MMRCAs (medium multi-role combat aircraft) to modernise its ageing and depleting fleet.

The MiG-21 fighters are to be phased out from 2014. The Navy is also expected to top up the order.

The tender for the new production unit comes even as the Government's Contract Negotiation Committee is negotiating the cost of procuring the fourth-generation fighters with the finalist vendor, France's Dassault Aviation.

HAL plans to locate it at Challaghatta where it has large tracts of land. The integrated 'green' factory complex will include hangars, runways and residential units.

The area is close to the old international airport, which was closed to commercial flights in May 2008.

The HAL defence airport continues to operate military, VVIP, charter and select non-scheduled flights into and out of Bangalore.

The Ministry of Defence said in February this year that a Contract Negotiation Committee had started negotiations with the L1 MMRCA bidder, France's Dassault.

This was for its lower price over the European Eurofighter consortium for its Typhoon. Dassault - if and when an agreeable price is reached in the coming months and the contract is sealed - will directly supply 18 Rafale MMRCAs to the IAF.

HAL will build the remaining 108 aircraft. It will be its first export of Rafale, which has also been used in Afghanistan and Libya.

Keenly watched

The MMRCA acquisition is said to be this century's largest and most keenly watched defence purchase contest.

The order is estimated at a minimum of around Rs 50,000 crore ($10 billion)

Also in the race were Boeing IDS (F/A-18 Super Hornet); Lockheed Martin (F-16IN Super Viper); Sweden's Saab (JAS 39 Gripen) and Russia's RAC MiG (MiG-35).

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Jet merges operations in rebranding exercise

etlite was formed after Jet Airways taking over Air Sahara, while Jet Airways Konnect was launched in 2009 to provide low-fare and value for money service.

New Delhi, March 25:

Jet Airways has announced the operation of JetLite and Jet Airways Konnect under one brand 'JetKonnect' from Sunday. With this, passengers will have the option of choosing full service on Jet Airways and low-fare service on JetKonnect.

Merger

JetLite was formed after Jet Airways taking over Air Sahara, while Jet Airways Konnect was launched in 2009 to provide low-fare and value for money service.

With the merger of these two brands, over 400 out of 600 flights being operated on Jet network are likely to be in the category of low-fare.

Jet Airways has already said that this merger is part of a strategic rebranding exercise.

It will simplify the group's service proposition and enhance brand recall, it added. The flights will be operated with a mixed fleet of Boeings and ATR aircraft on metro, tier II and III routes.

JetKonnect will offer premier services on certain routes where passengers may enjoy service identical to that available on flights of Jet Airways. This will be further expanded in a phased manner.

The cockpit and cabin crew will don the same uniform as their counterparts from Jet Airways.

Some JetKonnect flights will operate under the S2 code, while others will have flight numbers prefixed by the 9W code. 9W and S2 will also continue their existing code-share agreement enabling travellers to enjoy seamless connectivity between India and the world.

Mr Sudheer Raghavan, Chief Commercial Officer of Jet Airways, said, "The launch of brand JetKonnect is the culmination of a well-coordinated effort. We are confident that this initiative will be well accepted by all our guests.

The Jet Airways Group is continually looking at opportunities to optimally deploy and cross-utilise common resources of Jet Airways and JetLite wherever possible and this rebranding exercise will help further in synergising the airlines' collective operations."

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