Striking pilots and engineers of India’s Kingfisher Airlines have accepted a three-month portion of their eight months of unpaid salaries and agreed to return to work, even as management struggles to get its suspended Scheduled Operator’s Permit reinstated. Still, civil aviation minister Ajit Singh warned that paying salaries alone would not guarantee that Kingfisher would fly again. “I think the Kingfisher problem is much bigger; even if they pay the salaries today, are they going to take off and fly? I don`t think so,” he said.
Economy of India
The western Indian state of Gujarat has what amounts to its first regional airline with the launch of Deccan Shuttles by G.R. Gopinath, who founded India’s first low-cost airline, Air Deccan, before selling it to Kingfisher Airlines. Scheduled operations started on August 27 using a pair of nine-seat Cessna 208B Grand Caravans. The turboprop singles ply the Ahmedabad-Surat-Bhavnagar and Ahmedabad-Kandla routes, marking the first-ever direct air service between provincial cities in this large state.
India’s Directorate General of Civil Aviation (DGCA) expects to complete its second safety audit of that nation’s airlines by next month. The audits began with a look at Kingfisher Airlines and Air India Express because of ongoing labor issues at those airlines. The DGCA expects the first of these reports to be released soon.
Concerns over the safety oversight of financially struggling Kingfisher Airlines continue, even as the fleet–once 64 aircraft strong–has now shrunk to six A320s and five ATR 72s. The fleet reduction, driven largely by non-payment of leases, comes as a portion of the company’s pilots took strike action on August 18 to protest more than six months of back wages owed them by Kingfisher.
As highly taxed fuel, mounting debt and aggressive ticket pricing stifle the fledgling airline industry in India, the government seems ready to renege on its promise to allow foreign direct investment (FDI) in the country’s carriers. Current rules do not permit foreign airlines to invest in domestic carriers, although non-aviation-related investors can hold up to a 49-percent stake.
With its economic growth slowing, India is urging U.S. companies to invest in its aviation industry. At the recent U.S.-India Aviation Summit in New Delhi, Indian civil aviation minister Nasim Zaidi urged American firms to back plans for some $130 billion in investments over the next 10 to 15 years in areas such as airport infrastructure, maintenance, repair and overhaul facilities, cargo facilities and training centers. The Indian government is willing to see some 30 airports developed under joint ventures or public private partnerships (PPP). The country already permits 100-percent “foreign direct investment” (FDI) in airport projects and some 41 airport projects are already being conducted under PPP terms.
Shares in cash-strapped Indian carrier Kingfisher Airline fell by almost 18 percent on November 18 as company chairman Vijay Mallya worked to secure new short- and long-term funding amid reports of further routes being cut and flights cancelled. On November 17, Mallya confirmed that he is negotiating with an undisclosed high-net-worth individual in India with a view to injecting approximately $250 million into Kingfisher.
In a three-way deal that first came to light as a memorandum of understanding (MOU) last year, Sikorsky announced last month that it had completed an agreement for India’s Tata Advanced Systems Ltd (TASL) to build the cabins of its S-92 Helibus in India.
The cabins will be manufactured at a new TASL facility in Hyderabad in the state of Andhra Pradesh. Deliveries will begin next year.
In a three-way deal that first came to light as a memorandum of understanding (MOU) last year, Sikorsky announced on Friday that it completed an agreement for India’s Tata Advanced Systems Ltd. (TASL) to build the cabins of its S-92 Helibus in India. The cabins will be manufactured at a new TASL facility in Hyderabad in the state of Andhra Pradesh. Deliveries will begin next year.
Tata Ltd., a UK-based subsidiary of India’s Tata Sons, has agreed to take a one-third share of Italy’s Piaggio Aero Industries, manufacturer of the Avanti II turboprop twin. The proposed investment by Tata Ltd., which was expected to receive regulatory and other approvals last month, includes the purchase of existing shares from current shareholders and a new share offering.