ibnlive » Business

Mar 14, 2012 at 11:05am IST

Kingfisher Airlines cuts international operations

Mumbai: Hoping to improve its financials, cash-strapped Kingfisher Airlines (KFA) has slashed wide-bodied aircraft operations on international sectors that are making heavy losses, an official said on Wednesday.

The beleaguered carrier has already returned one leased Airbus A330-320 to its lessor in Britain, the official said on Wednesday morning.

The airline indicated more such developments by assuring that "positive and immediate action is being taken on all fronts to cut costs" without specifying the exact measures.

Kingfisher Airlines cuts international operations

The beleaguered carrier has already returned one leased Airbus A330-320 to its lessor in Britain, the airlines said.

KFA's flight operations continue to be affected for over a week -- it managed to operate only 101 flights Tuesday and promised to operate a similar number even Wednesday.

This is a sharp fall as compared to 145 just two days ago, Monday.

While emphasising that it was trying to protect the interests of the airline's employees, the official hinted at possible retrenchment - "We share their pain caused by unpaid salaries and we are also trying to protect their jobs apart from paying salaries."

Though many of the KFA pilots and maintenance engineers are unhappy, the official said that the airlines chairperson Vijay Mallya will meet them Thursday in New Delhi to sort out pending issues.

Reiterating that the crises in KFA's operations were due to the suspension of its ICH (IATA Clearing House) and BSP (Billing and Settlement Plan) accounts - with the IATA owing to the freeze on its IATA accounts by the Income Tax Department, the airline said it was making all efforts to operate flights as per schedules despite crew shortage.

Efforts are underway to convince the Income Tax department to unfreeze its accounts soon and the consortium of bankers to release the urgent interim working capital cleared by it Feb 17.

"This is not dependent on State Bank of India. SBI can only consider additional facilities once our account with them is standard," said the official, adding this was discussed in the consortium meeting.